0001466026-22-000016 | 10-Q | XBRL Viewer | Midland States Bancorp INC

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Cover Page - shares	9 Months Ended
Cover Page - shares	Sep. 30, 2022	Oct. 21, 2022
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
Document Transition Report	false
Entity File Number	001-35272
Entity Registrant Name	MIDLAND STATES BANCORP, INC.
Entity Incorporation, State or Country Code	IL
Entity Tax Identification Number	37-1233196
Entity Address, Address Line One	1201 Network Centre Drive
Entity Address, City or Town	Effingham
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	62401
City Area Code	217
Local Phone Number	342-7321
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding (in shares)		22,149,470
Entity Central Index Key	0001466026
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Common stock
Document Information [Line Items]
Title of 12(b) Security	Common stock, $0.01 par value
Trading Symbol	MSBI
Security Exchange Name	NASDAQ
Depository Shares
Document Information [Line Items]
Title of 12(b) Security	Depositary Shares, each representing a 1/40th interest in a share of 7.75% fixed rate reset non-cumulative perpetual preferred stock, Series A
Trading Symbol	MSBIP
Security Exchange Name	NASDAQ

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Assets
Cash and due from banks	$ 309,531	$ 673,297
Federal funds sold	3,657	7,074
Cash and cash equivalents	313,188	680,371
Investment securities available for sale, at fair value (allowance for credit losses of $0 and $221 at September 30, 2022 and December 31, 2021, respectively)	681,889	906,603
Equity securities, at fair value	8,615	9,529
Loans	6,198,451	5,224,801
Allowance for credit losses on loans	(58,639)	(51,062)
Total loans, net	6,139,812	5,173,739
Loans held for sale	4,338	32,045
Premises and equipment, net	77,519	79,220
Other real estate owned	11,141	12,059
Nonmarketable equity securities	39,696	36,341
Accrued interest receivable	17,537	19,470
Loan servicing rights, at lower of cost or fair value	1,297	28,865
Commercial FHA mortgage loan servicing rights held for sale	23,995	0
Goodwill	161,904	161,904
Other intangible assets, net	22,198	24,374
Company-owned life insurance	149,648	148,378
Other assets	169,100	130,907
Total assets	7,821,877	7,443,805
Deposits:
Noninterest-bearing demand deposits	2,025,237	2,245,701
Interest-bearing deposits	4,370,015	3,864,947
Total deposits	6,395,252	6,110,648
Short-term borrowings	58,518	76,803
Federal Home Loan Bank advances and other borrowings	360,000	310,171
Subordinated debt	139,370	139,091
Trust preferred debentures	49,824	49,374
Accrued interest payable and other liabilities	79,634	93,881
Total liabilities	7,082,598	6,779,968
Shareholders’ Equity:
Preferred stock, $2.00 par value; 4,000,000 shares authorized; 115,000 Series A shares, $1,000 per share liquidation preference, issued and outstanding at September 30, 2022	110,548	0
Common stock, $0.01 par value; 40,000,000 shares authorized; 22,074,740 and 22,050,537 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively	221	221
Capital surplus	447,672	445,907
Retained earnings	259,221	212,472
Accumulated other comprehensive (loss) income, net of tax	(78,383)	5,237
Total shareholders’ equity	739,279	663,837
Total liabilities and shareholders’ equity	$ 7,821,877	$ 7,443,805

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Investment securities, available-for-sale, allowance for credit loss	$ 0	$ 221
Preferred stock, par value (in dollars per share)	$ 2.00
Preferred stock, shares authorized (in shares)	4,000,000
Preferred stock, shares issued (in shares)	115,000
Preferred stock, liquidation price (in dollars per share)	$ 1,000
Preferred stock, shares outstanding (in shares)	115,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	40,000,000	40,000,000
Common stock, shares issued (in shares)	22,074,740	22,050,537
Common stock, shares outstanding (in shares)	22,074,740	22,050,537

CONSOLIDATED STATEMENTS OF INCOME—(UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Interest income:
Loans: Taxable	$ 72,901	$ 52,699	$ 192,430	$ 159,743
Loans: Tax exempt	527	615	1,589	1,935
Loans held for sale	60	107	357	810
Investment securities:
Taxable	3,765	3,396	11,717	10,127
Tax exempt	628	899	2,162	2,474
Nonmarketable equity securities	550	558	1,521	1,847
Federal funds sold and cash investments	1,125	216	1,764	454
Total interest income	79,556	58,490	211,540	177,390
Interest expense:
Deposits	10,249	2,584	16,220	8,759
Short-term borrowings	28	21	73	65
Federal Home Loan Bank advances and other borrowings	2,424	1,993	5,071	7,033
Subordinated debt	2,010	2,011	6,032	6,694
Trust preferred debentures	821	485	1,959	1,465
Total interest expense	15,532	7,094	29,355	24,016
Net interest income	64,024	51,396	182,185	153,374
Provision for credit losses:
Provision for credit losses on loans	6,974	0	15,847	3,950
Provision for credit losses on unfunded commitments	0	0	956	(800)
Recapture of provision for other credit losses	0	(184)	(221)	(224)
Total provision for credit losses	6,974	(184)	16,582	2,926
Net interest income after provision for credit losses	57,050	51,580	165,603	150,448
Noninterest income:
Wealth management revenue	6,199	7,175	19,481	19,635
Residential mortgage banking revenue	210	1,287	1,193	4,423
Service charges on deposit accounts	2,597	2,268	6,969	6,010
Interchange revenue	3,531	3,651	10,401	10,823
(Loss) gain on sales of investment securities, net	(129)	160	(230)	537
Impairment on commercial mortgage servicing rights	0	(3,037)	(1,263)	(5,460)
Company-owned life insurance	929	869	2,788	2,592
Other income	2,489	2,770	6,713	8,816
Total noninterest income	15,826	15,143	46,052	47,376
Noninterest expense:
Salaries and employee benefits	22,889	22,175	67,404	64,774
Occupancy and equipment	3,850	3,701	11,094	11,437
Data processing	6,093	6,495	18,048	18,776
Professional	1,693	1,738	5,181	9,472
Marketing	1,026	860	2,447	2,037
Communications	587	689	1,934	2,335
Amortization of intangible assets	1,361	1,445	4,077	4,430
Federal Home Loan Bank advances prepayment fees	0	0	0	3,677
Other expense	5,997	4,189	15,534	12,374
Total noninterest expense	43,496	41,292	125,719	129,312
Income before income taxes	29,380	25,431	85,936	68,512
Income taxes	5,859	5,883	19,783	10,302
Net income	$ 23,521	$ 19,548	$ 66,153	$ 58,210
Per common share data:
Basic earnings per common share (in dollars per share)	$ 1.04	$ 0.86	$ 2.93	$ 2.56
Diluted earnings per common share (in dollars per share)	$ 1.04	$ 0.86	$ 2.92	$ 2.55
Weighted average common shares outstanding (in shares)	22,338,828	22,520,499	22,306,323	22,544,898
Weighted average diluted common shares outstanding (in shares)	22,390,438	22,577,880	22,367,095	22,613,972

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME—(UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Statement of Comprehensive Income [Abstract]
Net income	$ 23,521	$ 19,548	$ 66,153	$ 58,210
Investment securities available for sale:
Unrealized (losses) gains that occurred during the period	(31,764)	662	(115,199)	(5,514)
Recapture of provision for credit loss expense	0	(184)	(221)	(224)
Reclassification adjustment for realized net losses (gains) on sales of investment securities included in net income	129	(160)	230	(537)
Income tax effect	8,134	(87)	31,111	1,726
Change in investment securities available for sale, net of tax	(23,501)	231	(84,079)	(4,549)
Cash flow hedges:
Net unrealized derivative (losses) gains on cash flow hedges	(2,501)	729	594	5,567
Reclassification adjustment for gains realized in net income	0	0	0	314
Income tax effect	716	(201)	(135)	(1,618)
Change in cash flow hedges, net of tax	(1,785)	528	459	4,263
Other comprehensive (loss) income, net of tax	(25,286)	759	(83,620)	(286)
Total comprehensive (loss) income	$ (1,765)	$ 20,307	$ (17,467)	$ 57,924

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY—(UNAUDITED) - USD ($) $ in Thousands	Total	Preferred stock	Common stock	Capital surplus	Retained earnings	Accumulated other comprehensive (loss) income
Beginning Balance at Dec. 31, 2020	$ 621,391		$ 223	$ 453,410	$ 156,327	$ 11,431
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	58,210				58,210
Other comprehensive income (loss)	(286)					(286)
Common dividends declared	(18,927)				(18,927)
Common stock repurchased	(6,448)		(3)	(6,445)
Share-based compensation expense	1,424			1,424
Issuance of common stock under employee benefit plans	2,480		2	2,478
Ending Balance at Sep. 30, 2021	657,844		222	450,867	195,610	11,145
Beginning Balance at Jun. 30, 2021	648,186		224	455,215	182,361	10,386
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	19,548				19,548
Other comprehensive income (loss)	759					759
Common dividends declared	(6,299)				(6,299)
Common stock repurchased	(5,240)		(2)	(5,238)
Share-based compensation expense	438			438
Issuance of common stock under employee benefit plans	452			452
Ending Balance at Sep. 30, 2021	657,844		222	450,867	195,610	11,145
Beginning Balance at Dec. 31, 2021	663,837	$ 0	221	445,907	212,472	5,237
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	66,153				66,153
Other comprehensive income (loss)	(83,620)					(83,620)
Issuance of preferred stock, net of offering costs	110,548	110,548
Common dividends declared	(19,404)				(19,404)
Common stock repurchased	(1,109)		(1)	(1,108)
Share-based compensation expense	1,547			1,547
Issuance of common stock under employee benefit plans	1,327		1	1,326
Ending Balance at Sep. 30, 2022	739,279	110,548	221	447,672	259,221	(78,383)
Beginning Balance at Jun. 30, 2022	636,188	0	221	446,894	242,170	(53,097)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	23,521				23,521
Other comprehensive income (loss)	(25,286)					(25,286)
Issuance of preferred stock, net of offering costs	110,548	110,548
Common dividends declared	(6,470)				(6,470)
Share-based compensation expense	501			501
Issuance of common stock under employee benefit plans	277		0	277
Ending Balance at Sep. 30, 2022	$ 739,279	$ 110,548	$ 221	$ 447,672	$ 259,221	$ (78,383)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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- Definition

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

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-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(31))
-URI https://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(29))
-URI https://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(30))
-URI https://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 50
-Paragraph 28
-Subparagraph (f)
-URI https://asc.fasb.org/extlink&oid=123596393&loc=d3e14064-108612

Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 323
-SubTopic 10
-Section 50
-Paragraph 3
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=114001798&loc=d3e33918-111571

+ Details

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY—(UNAUDITED) (Parenthetical) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Statement of Stockholders' Equity [Abstract]
Common dividend declared, per share (in dollars per share)	$ 0.29	$ 0.28	$ 0.87	$ 0.84

CONSOLIDATED STATEMENTS OF CASH FLOWS—(UNAUDITED) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Cash flows from operating activities:
Net income	$ 66,153	$ 58,210
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses	16,582	2,926
Depreciation on premises and equipment	3,665	4,223
Amortization of intangible assets	4,077	4,430
Amortization of operating lease right-of-use asset	1,373	1,281
Amortization of loan servicing rights	2,202	2,497
Share-based compensation expense	1,547	1,424
Increase in cash surrender value of life insurance	(2,524)	(2,592)
Gain on proceeds from company-owned life insurance	(264)	0
Investment securities amortization, net	1,923	3,141
(Loss) gain on sales of investment securities, net	230	(537)
Loss (gain) on sales of other real estate owned	131	(418)
Impairment on other real estate owned	743	426
Origination of loans held for sale	(123,602)	(394,905)
Proceeds from sales of loans held for sale	252,078	634,445
Gain on sale of loans held for sale	(1,035)	(3,799)
Impairment on commercial mortgage servicing rights	1,263	5,460
Impairment on mortgage servicing rights held for sale	0	222
Net change in operating assets and liabilities:
Accrued interest receivable	1,969	1,502
Other assets	(37,534)	(21,279)
Accrued expenses and other liabilities	17,095	4,436
Net cash provided by operating activities	206,072	301,093
Cash flows from investing activities:
Purchases of investment securities available for sale	(100,115)	(338,456)
Proceeds from sales of investment securities available for sale	136,403	14,777
Maturities and payments on investment securities available for sale	71,305	164,213
Purchases of equity securities	(441)	(232)
Net (increase) decrease in loans	(1,065,192)	55,487
Purchases of premises and equipment	(2,088)	(1,853)
Proceeds from sale of premises and equipment	158	646
Purchases of nonmarketable equity securities	(6,360)	0
Proceeds from sales of nonmarketable equity securities	3,005	14,405
Proceeds from sales of other real estate owned	561	9,089
Purchases of company-owned life insurance	0	(550)
Proceeds from settlements of company-owned life insurance	1,518	0
Net cash received (paid) on acquisition	60,275	(2,715)
Net cash used in investing activities	(900,971)	(85,189)
Cash flows from financing activities:
Net increase in deposits	204,810	500,360
Net decrease in short-term borrowings	(18,285)	(2,291)
Proceeds from FHLB borrowings	1,900,000	350,000
Payments made on FHLB borrowings and other borrowings	(1,850,000)	(689,000)
Payments made on subordinated debt	0	(31,075)
Redemption of Series G preferred stock	(171)	0
Proceeds from Series A preferred stock offering	110,548	0
Cash dividends paid on common stock	(19,404)	(18,927)
Common stock repurchased	(1,109)	(6,448)
Proceeds from issuance of common stock under employee benefit plans	1,327	2,480
Net cash provided by financing activities	327,716	105,099
Net (decrease) increase in cash and cash equivalents	(367,183)	321,003
Cash and cash equivalents:
Beginning of period	680,371	341,640
End of period	313,188	662,643
Cash payments for:
Interest paid on deposits and borrowed funds	29,449	25,561
Income tax paid, net of refunds	22,014	(6,648)
Supplemental disclosures of noncash investing and financing activities:
Transfer of loans to loans held for sale	99,505	123,117
Transfer of loans to other real estate owned	517	583
Transfer of loan servicing rights, at lower of cost or market to loan servicing rights held for sale	23,995	0
Pending settlements on securities purchased	$ 0	$ (62,923)

BUSINESS DESCRIPTION	9 Months Ended
BUSINESS DESCRIPTION	Sep. 30, 2022
BUSINESS DESCRIPTION
BUSINESS DESCRIPTION	BUSINESS DESCRIPTION Midland States Bancorp, Inc. (the “Company,” “we,” “our,” or “us”) is a diversified financial holding company headquartered in Effingham, Illinois. Our wholly owned banking subsidiary, Midland States Bank (the “Bank”), has branches across Illinois and in Missouri, and provides a full range of commercial and consumer banking products and services, business equipment financing, merchant credit card services, trust and investment management services, and insurance and financial planning services. Our principal business activity has been lending to and accepting deposits from individuals, businesses, municipalities and other entities. We have derived income principally from interest charged on loans and, to a lesser extent, from interest and dividends earned on investment securities. We have also derived income from noninterest sources, such as: fees received in connection with various lending and deposit services; wealth management services; commercial Federal Housing Administration ("FHA") mortgage loan servicing; residential mortgage loan originations, sales and servicing; and, from time to time, gains on sales of assets. Our principal expenses include interest expense on deposits and borrowings, operating expenses, such as salaries and employee benefits, occupancy and equipment expenses, data processing costs, professional fees and other noninterest expenses, provisions for credit losses and income tax expense.

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Sep. 30, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The consolidated financial statements of the Company are unaudited and should be read in conjunction with the consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the Securities and Exchange Commission (the “SEC”) on February 25, 2022. The consolidated financial statements have been prepared in accordance with the accounting principles generally accepted in the United States of America (“GAAP”) and conform to predominant practices within the banking industry. A discussion of these policies can be found in Note 1 – Summary of Significant Accounting Policies included in the Company's 2021 Annual Report on Form 10-K. Certain reclassifications of 2021 amounts have been made to conform to the 2022 presentation. Management has evaluated subsequent events for potential recognition or disclosure. Operating results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 or any other period. Principles of Consolidation The consolidated financial statements include the accounts of the parent company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated. Assets held for customers in a fiduciary or agency capacity are not assets of the Company and, accordingly, other than trust cash on deposit with the Bank, are not included in the accompanying unaudited balance sheets. Accounting Guidance Issued But Not Yet Adopted FASB ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting – In March 2020, the FASB issued ASU No. 2020-04 which provides optional expedients and exceptions for accounting related to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. ASU 2020-04 applies only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform; it does not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, for which an entity has elected certain optional expedients and that are retained through the end of the hedging relationship. ASU 2020-04 was effective upon issuance and generally can be applied through December 31, 2022. The Company has been monitoring its volume of commercial loans tied to LIBOR. In 2021, the Company began prioritizing SOFR as the preferred alternative reference rate with plans to cease booking LIBOR based commitments after the end of 2021. Loans with a maturity after June 2023 are being reviewed and monitored to ensure there is appropriate fallback language in place when LIBOR is no longer published. Loans with a maturity date before that time should naturally mature and be re-underwritten with the alternative index rate. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope, which addresses questions about whether Topic 848 can be applied to derivative instruments that do not reference a rate that is expected to be discontinued but that use an interest rate for margining, discounting, or contract price alignment that is expected to be modified as a result of reference rate reform, commonly referred to as the "discounting transition". The amendments clarify that certain optional expedients and exceptions in Topic 848 do apply to derivatives that are affected by the discounting transition. The amendments in ASU 2021-01 are effective immediately. The Company believes the adoption of this guidance on activities subsequent to December 31, 2021 through December 31, 2022 will not have a material impact on the consolidated financial statements. FASB ASU No. 2022-02, Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures – In March 2022, the FASB issued ASU No. 2022-02, which 1) eliminates the accounting guidance for troubled debt restructurings ("TDRs") by creditors while enhancing the disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty; and 2) requires that an entity disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases. ASU 2022-02 is effective for fiscal years beginning after December 15, 2022 and the amendments should be applied prospectively, although the entity has the option to apply a modified retrospective transition method for the recognition and measurement of TDRs, resulting in a cumulative-effect adjustment to retained earnings in the period of adoption. The Company is currently evaluating the impact of adopting the new guidance on its consolidated financial statements.

ACQUISITIONS

9 Months Ended

Sep. 30, 2022

Business Combinations [Abstract]

ACQUISITIONS

FNBC Bank & Trust

On June 17, 2022, the Company completed its branch acquisition from FNBC Bank & Trust ("FNBC"), whereby we acquired $79.8 million of deposits and $16.6 million of loans as well as other assets and liabilities associated with FNBC's branches in Mokena and Yorkville, Illinois. The acquisition was accounted for under the acquisition method of accounting. Accordingly, the Company recognized amounts for identified tangible and intangible assets acquired and liabilities assumed at their estimated acquisition date fair values, while $0.4 million of transaction and integration costs were expensed as incurred.

A summary of the fair value of the assets acquired and liabilities assumed are included in the table below.


(dollars in thousands)	FNBC
Assets acquired:
Cash and cash equivalents	$	60,275
Loans	16,632
Premises and equipment, net	950
Accrued interest receivable	36
Intangible assets	1,901
Total assets acquired	$	79,794
Liabilities assumed:
Deposits	$	79,794
Total liabilities assumed	$	79,794
Intangible assets:
Core deposit intangible	$	1,901
Estimated useful life	10 years

ATG Trust Company

On June 1, 2021, the Company completed its acquisition of substantially all of the trust assets of ATG Trust Company (“ATG Trust”), a trust company based in Chicago, Illinois, with approximately $399.7 million in assets under management. In aggregate, the Company acquired the assets of ATG Trust for $2.7 million in cash. The acquisition was accounted for under the acquisition method of accounting. Accordingly, the Company recognized amounts for identifiable assets acquired at their estimated acquisition date fair values, while $0.4 million of transaction and integration costs associated with the acquisition were expensed in 2021.

INVESTMENT SECURITIES

9 Months Ended

Sep. 30, 2022

Investments, Debt and Equity Securities [Abstract]

INVESTMENT SECURITIES

Investment Securities Available for Sale

Investment securities available for sale at September 30, 2022 and December 31, 2021 were as follows:


	September 30, 2022
(dollars in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Allowance for credit losses		Fair value
Investment securities available for sale
U.S. Treasury securities	$	66,369	$	—	$	5,873	$	—	$	60,496
U.S. government sponsored entities and U.S. agency securities	32,267		78		4,480		—		27,865
Mortgage-backed securities - agency	469,822		5		78,212		—		391,615
Mortgage-backed securities - non-agency	25,341		—		4,183		—		21,158
State and municipal securities	105,838		128		10,905		—		95,061
Corporate securities	95,313		—		9,619		—		85,694
Total available for sale securities	$	794,950	$	211	$	113,272	$	—	$	681,889


	December 31, 2021
(dollars in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Allowance for credit losses		Fair value
Investment securities available for sale
U.S. Treasury securities	$	65,347	$	—	$	430	$	—	$	64,917
U.S. government sponsored entities and U.S. agency securities	34,569		79		831		—		33,817
Mortgage-backed securities - agency	444,484		2,687		6,901		—		440,270
Mortgage-backed securities - non-agency	29,037		50		381		—		28,706
State and municipal securities	137,904		5,561		366		—		143,099
Corporate securities	193,354		3,128		467		221		195,794
Total available for sale securities	$	904,695	$	11,505	$	9,376	$	221	$	906,603

The following is a summary of the amortized cost and fair value of the investment securities available for sale, by maturity, at September 30, 2022. Expected maturities may differ from contractual maturities in mortgage-backed securities because the mortgages underlying the securities may be prepaid without penalties. The maturities of all other investment securities available for sale are based on final contractual maturity.


(dollars in thousands)	Amortized cost		Fair value
Investment securities available for sale
Within one year	$	9,766	$	9,793
After one year through five years	123,074		113,574
After five years through ten years	135,520		119,588
After ten years	31,427		26,161
Mortgage-backed securities	495,163		412,773
Total available for sale securities	$	794,950	$	681,889

Proceeds and gross realized gains on sales of investment securities available for sale for the three and nine months ended September 30, 2022 and 2021, are summarized as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Investment securities available for sale
Proceeds from sales	$	28,663	$	2,160	$	136,403	$	14,777
Gross realized gains on sales	113		160		829		537
Gross realized losses on sales	(242)		—		(1,059)		—

The table below presents a rollforward by security type for the three and nine months ended September 30, 2022 and 2021 of the allowance for credit losses on investment securities available for sale held at period end:


(dollars in thousands)	Mortgage-backed securities - non-agency		State and municipal securities		Corporate securities		Total
Changes in allowance for credit losses on investment securities available for sale:
For the three months ended September 30, 2022
Balance, beginning of period	$	—	$	—	$	—	$	—
Current-period provision for expected credit losses	—		—		—		—
Balance, end of period	$	—	$	—	$	—	$	—
For the nine months ended September 30, 2022
Balance, beginning of period	$	—	$	—	$	221	$	221
Current-period provision for expected credit losses	—		—		(221)		(221)
Balance, end of period	$	—	$	—	$	—	$	—
For the three months ended September 30, 2021
Balance, beginning of period	$	113	$	—	$	213	$	326
Current-period provision for expected credit losses	(113)		—		(71)		(184)
Balance, end of period	$	—	$	—	$	142	$	142
For the nine months ended September 30, 2021
Balance, beginning of period	$	—	$	29	$	337	$	366
Current-period provision for expected credit losses	—		(29)		(195)		(224)
Balance, end of period	$	—	$	—	$	142	$	142

Unrealized losses and fair values for investment securities available for sale as of September 30, 2022 and December 31, 2021, for which an allowance for credit losses has not been recorded, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, are summarized as follows:


	September 30, 2022
	Less than 12 Months				12 Months or more				Total
(dollars in thousands)	Fair value		Unrealized loss		Fair value		Unrealized loss		Fair value		Unrealized loss
Investment securities available for sale
U.S. Treasury securities	$	37,689	$	3,305	$	22,807	$	2,568	$	60,496	$	5,873
U.S. government sponsored entities and U.S. agency securities	333		19		23,289		4,461		23,622		4,480
Mortgage-backed securities - agency	168,562		21,838		222,652		56,374		391,214		78,212
Mortgage-backed securities - non-agency	6,228		879		14,930		3,304		21,158		4,183
State and municipal securities	56,578		5,879		22,193		5,026		78,771		10,905
Corporate securities	57,401		4,767		28,293		4,852		85,694		9,619
Total available for sale securities	$	326,791	$	36,687	$	334,164	$	76,585	$	660,955	$	113,272


	December 31, 2021
	Less than 12 Months				12 Months or more				Total
(dollars in thousands)	Fair value		Unrealized loss		Fair value		Unrealized loss		Fair value		Unrealized loss
Investment securities available for sale
U.S. Treasury securities	$	64,917	$	430	$	—	$	—	$	64,917	$	430
U.S. government sponsored entities and U.S. agency securities	17,487		263		9,432		568		26,919		831
Mortgage-backed securities - agency	317,372		6,633		9,051		268		326,423		6,901
Mortgage-backed securities - non-agency	24,095		381		—		—		24,095		381
State and municipal securities	27,324		270		2,538		96		29,862		366
Corporate securities	—		—		—		—		—		—
Total available for sale securities	$	451,195	$	7,977	$	21,021	$	932	$	472,216	$	8,909

At September 30, 2022, 393 investment securities available for sale had unrealized losses with aggregate depreciation of 14.63% from their amortized cost basis. For all of the above investment securities, the unrealized losses were generally due to changes in interest rates, and unrealized losses were considered to be temporary as the fair value is expected to recover as the securities approach their respective maturity dates. The issuers are of high credit quality and all principal amounts are expected to be paid when securities mature. The Company does not intend to sell and it is likely that the Company will not be required to sell the securities prior to their anticipated recovery.

Equity Securities

Equity securities are recorded at fair value and totaled $8.6 million and $9.5 million at September 30, 2022 and December 31, 2021, respectively.

During both the three and nine months ended September 30, 2022 and 2021, there were no sales of equity securities. Net unrealized gains and losses on equity securities for the three and nine months ended September 30, 2022 and 2021 are summarized below:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Equity securities



Net unrealized (losses) gains	$	(118)	$	112	$	(1,065)	$	338

Net unrealized gains and losses on equity securities were recorded in other income in the consolidated statements of income.

LOANS

9 Months Ended

Sep. 30, 2022

Receivables [Abstract]

LOANS

The following table presents total loans outstanding by portfolio class, as of September 30, 2022 and December 31, 2021:


(dollars in thousands)	September 30, 2022		December 31, 2021
Commercial:
Commercial	$	852,930	$	770,670
Commercial other	683,353		679,518
Commercial real estate:
Commercial real estate non-owner occupied	1,567,308		1,105,333
Commercial real estate owner occupied	505,174		469,658
Multi-family	328,473		171,875
Farmland	65,348		69,962
Construction and land development	225,549		193,749
Total commercial loans	4,228,135		3,460,765
Residential real estate:
Residential first lien	294,432		274,412
Other residential	61,793		63,739
Consumer:
Consumer	110,226		106,008
Consumer other	1,046,254		896,597
Lease financing	457,611		423,280
Total loans, gross	$	6,198,451	$	5,224,801

Total loans include net deferred loan costs of $4.2 million and $4.6 million at September 30, 2022 and December 31, 2021, respectively, and unearned discounts of $54.0 million and $46.1 million within the lease financing portfolio at September 30, 2022 and December 31, 2021, respectively.

At September 30, 2022, the Company had residential real estate loans held for sale totaling $4.3 million, compared to commercial real estate and residential real estate loans held for sale totaling $32.0 million at December 31, 2021. The Company sold commercial real estate, residential real estate and consumer loans with proceeds totaling $48.5 million and $252.1 million during the three and nine months ended September 30, 2022, respectively, and $139.9 million and $634.4 million during the comparable periods in 2021, respectively.

Classifications of Loan Portfolio

The Company monitors and assesses the credit risk of its loan portfolio using the classes set forth below. These classes also represent the segments by which the Company monitors the performance of its loan portfolio and estimates its allowance for credit losses on loans.

Commercial—Loans to varying types of businesses, including municipalities, school districts and nonprofit organizations, for the purpose of supporting working capital, operational needs and term financing of equipment. Repayment of such loans is generally provided through operating cash flows of the business. Commercial loans are predominately secured by equipment, inventory, accounts receivable, and other sources of repayment. Paycheck Protection Program ("PPP") loans of $2.8 million and $52.5 million as of September 30, 2022 and December 31, 2021, respectively, and commercial FHA warehouse lines of $51.3 million and $91.9 million as of September 30, 2022 and December 31, 2021, respectively, were included in this classification.

Commercial real estate—Loans secured by real estate occupied by the borrower for ongoing operations, including loans to borrowers engaged in agricultural production, and non-owner occupied real estate leased to one or more tenants, including commercial office, industrial, special purpose, retail and multi-family residential real estate loans.

Construction and land development—Secured loans for the construction of business and residential properties. Real estate construction loans often convert to a real estate commercial loan at the completion of the construction period. Secured development loans are made to borrowers for the purpose of infrastructure improvements to vacant land to create finished marketable residential and commercial lots/land. Most land development loans are originated with the intention that the loans

will be paid through the sale of developed lots/land by the developers within twelve months of the completion date. Interest reserves may be established on real estate construction loans.

Residential real estate—Loans secured by residential properties that generally do not qualify for secondary market sale; however, the risk to return and/or overall relationship are considered acceptable to the Company. This category also includes loans whereby consumers utilize equity in their personal residence, generally through a second mortgage, as collateral to secure the loan.

Consumer—Loans to consumers primarily for the purpose of home improvements or acquiring automobiles, recreational vehicles and boats. Consumer loans consist of relatively small amounts that are spread across many individual borrowers.

Lease financing—Our equipment leasing business provides financing leases to varying types of businesses, nationwide, for purchases of business equipment and software. The financing is secured by a first priority interest in the financed assets and generally requires monthly payments.

Commercial, commercial real estate, and construction and land development loans are collectively referred to as the Company’s commercial loan portfolio, while residential real estate, consumer loans and lease financing receivables are collectively referred to as the Company’s other loan portfolio.

We have extended loans to certain of our directors, executive officers, principal shareholders and their affiliates. These loans were made in the ordinary course of business upon substantially the same terms, including collateralization and interest rates prevailing at the time. The aggregate loans outstanding to the Company's directors, executive officers, principal shareholders and their affiliates totaled $20.0 million and $13.9 million at September 30, 2022 and December 31, 2021, respectively. The new loans, other additions, repayments and other reductions for the three and nine months ended September 30, 2022 and 2021, are summarized as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Beginning balance	$	23,097	$	18,762	$	13,869	$	19,693
New loans and other additions	—		21		9,804		1,045
Repayments and other reductions	(3,081)		(3,424)		(3,657)		(5,379)
Ending balance	$	20,016	$	15,359	$	20,016	$	15,359

The following table represents, by loan portfolio segment, a summary of changes in the allowance for credit losses on loans for the three and nine months ended September 30, 2022 and 2021:


	Commercial Loan Portfolio						Other Loan Portfolio
(dollars in thousands)	Commercial		Commercial real estate		Construction and land development		Residential real estate		Consumer		Lease financing		Total
Changes in allowance for credit losses on loans for the three months ended September 30, 2022:
Balance, beginning of period	$	12,748	$	27,874	$	1,101	$	3,416	$	2,994	$	6,765	$	54,898
Provision for credit losses on loans	3,226		1,787		472		852		606		31		6,974
Charge-offs	(1,655)		(1,232)		—		(166)		(316)		(485)		(3,854)
Recoveries	45		1		18		69		121		367		621
Balance, end of period	$	14,364	$	28,430	$	1,591	$	4,171	$	3,405	$	6,678	$	58,639

Changes in allowance for credit losses on loans for the nine months ended September 30, 2022:
Balance, beginning of period	$	14,375	$	22,993	$	972	$	2,695	$	2,558	$	7,469	$	51,062
Provision for credit losses on loans	3,504		9,515		595		1,569		1,278		(614)		15,847
Charge-offs	(3,869)		(4,084)		(6)		(315)		(812)		(1,190)		(10,276)
Recoveries	354		6		30		222		381		1,013		2,006
Balance, end of period	$	14,364	$	28,430	$	1,591	$	4,171	$	3,405	$	6,678	$	58,639

Changes in allowance for credit losses on loans for the three months ended September 30, 2021:
Balance, beginning of period	$	14,849	$	30,718	$	1,733	$	3,683	$	2,292	$	5,389	$	58,664
Provision for credit losses on loans	(75)		(2,105)		(538)		(697)		292		3,123		—
Charge-offs	(317)		(1,663)		(138)		(35)		(280)		(1,227)		(3,660)
Recoveries	134		3		74		66		93		301		671
Balance, end of period	$	14,591	$	26,953	$	1,131	$	3,017	$	2,397	$	7,586	$	55,675

Changes in allowance for credit losses on loans for the nine months ended September 30, 2021:
Balance, beginning of period	$	19,851	$	25,465	$	1,433	$	3,929	$	2,338	$	7,427	$	60,443


Provision for credit losses on loans	(2,091)		4,854		(113)		(806)		429		1,677		3,950
Charge-offs	(3,457)		(3,382)		(410)		(286)		(740)		(1,996)		(10,271)
Recoveries	288		16		221		180		370		478		1,553
Balance, end of period	$	14,591	$	26,953	$	1,131	$	3,017	$	2,397	$	7,586	$	55,675

The Company utilizes a combination of models which measure probability of default and loss given default methodology in determining expected future credit losses.

The probability of default is the risk that the borrower will be unable or unwilling to repay its debt in full or on time. The risk of default is derived by analyzing the obligor’s capacity to repay the debt in accordance with contractual terms. Probability of default is generally associated with financial characteristics such as inadequate cash flow to service debt, declining revenues or operating margins, high leverage, declining or marginal liquidity, and the inability to successfully implement a business plan. In addition to these quantifiable factors, the borrower’s willingness to repay also must be evaluated.

The probability of default is forecasted, for most commercial and retail loans, using a regression model that determines the likelihood of default within the twelve month time horizon. The regression model uses forward-looking economic forecasts including variables such as gross domestic product, housing price index, and real disposable income to predict default rates. The forecasting method for the equipment financing portfolio assumes a rolling twelve-month average of the through-the-cycle default rate, to predict default rates for the twelve month time horizon.

The loss given default component is the percentage of defaulted loan balance that is ultimately charged off. As a method for estimating the allowance, a form of migration analysis is used that combines the estimated probability of loans experiencing default events and the losses ultimately associated with the loans experiencing those defaults. Multiplying one by

the other gives the Company its loss rate, which is then applied to the loan portfolio balance to determine expected future losses.

Within the model, the loss given default approach produces segmented loss given default estimates using a loss curve methodology, which is based on historical net losses from charge-off and recovery information. The main principle of a loss curve model is that the loss follows a steady timing schedule based on how long the defaulted loan has been on the books.

The Company’s expected loss estimate is anchored in historical credit loss experience, with an emphasis on all available portfolio data. The Company’s historical look-back period includes January 2012 through the current period on a monthly basis. When historical credit loss experience is not sufficient for a specific portfolio, the Company may supplement its own portfolio data with external models or data.

Historical data is evaluated in multiple components of the expected credit loss, including the reasonable and supportable forecast and the post-reversion period of each loan segment. The historical experience is used to infer probability of default and loss given default in the reasonable and supportable forecast period. In the post-reversion period, long-term average loss rates are segmented by loan pool.

Qualitative reserves reflect management’s overall estimate of the extent to which current expected credit losses on collectively evaluated loans will differ from historical loss experience. The analysis takes into consideration other analytics performed within the organization, such as enterprise and concentration management, along with other credit-related analytics as deemed appropriate. Management attempts to quantify qualitative reserves whenever possible.

The Company segments the loan portfolio into pools based on the following risk characteristics: financial asset type, collateral type, loan characteristics, credit characteristics, outstanding loan balances, contractual terms and prepayment assumptions, industry of borrower and concentrations, historical or expected credit loss patterns, and reasonable and supportable forecast periods.

Within the probability of default segmentation, credit metrics are identified to further segment the financial assets. The Company utilizes risk ratings for the commercial portfolios and days past due for the consumer and the lease financing portfolios.

The Company has defined five transitioning risk states for each asset pool within the expected credit loss model. The below table illustrates the transition matrix:


Risk state	Commercial loans risk rating	Consumer loans and equipment finance loans and leases days past due
1	0-5	0-14
2	6	15-29
3	7	30-59
4	8	60-89
Default	9+ and nonaccrual	90+ and nonaccrual

Expected Credit Losses

In calculating expected credit losses, the Company individually evaluates loans on nonaccrual status with a balance greater than $500,000, loans past due 90 days or more and still accruing interest, and loans that do not share risk characteristics

with other loans in the pool. The following table presents amortized cost basis of individually evaluated loans on nonaccrual status as of September 30, 2022 and December 31, 2021:


	September 30, 2022						December 31, 2021
(dollars in thousands)	Nonaccrual with allowance		Nonaccrual with no allowance		Total nonaccrual		Nonaccrual with allowance		Nonaccrual with no allowance		Total nonaccrual
Commercial:
Commercial	$	4,179	$	508	$	4,687	$	4,681	$	2,275	$	6,956
Commercial other	2,104		—		2,104		4,467		—		4,467
Commercial real estate:
Commercial real estate non-owner occupied	1,590		12,118		13,708		1,914		9,912		11,826
Commercial real estate owner occupied	2,882		1,340		4,222		2,164		1,340		3,504
Multi-family	164		9,003		9,167		201		1,967		2,168
Farmland	25		—		25		155		—		155
Construction and land development	245		—		245		83		—		83
Total commercial loans	11,189		22,969		34,158		13,665		15,494		29,159
Residential real estate:
Residential first lien	2,884		633		3,517		3,116		832		3,948
Other residential	798		—		798		836		—		836
Consumer:
Consumer	72		—		72		110		—		110

Lease financing	1,506		—		1,506		1,510		—		1,510
Total loans	$	16,449	$	23,602	$	40,051	$	19,237	$	16,326	$	35,563

There was no interest income recognized on nonaccrual loans during the three and nine months ended September 30, 2022 and 2021 while the loans were in nonaccrual status. Additional interest income that would have been recorded on nonaccrual loans had they been current in accordance with their original terms was $0.8 million and $1.9 million for the three and nine months ended September 30, 2022, respectively, and $0.6 million and $2.1 million for the three and nine months ended September 30, 2021, respectively.

Collateral Dependent Financial Assets

A collateral dependent financial loan relies solely on the operation or sale of the collateral for repayment. In evaluating the overall risk associated with a loan, the Company considers character, overall financial condition and resources, and payment record of the borrower; the prospects for support from any financially responsible guarantors; and the nature and degree of

protection provided by the cash flow and value of any underlying collateral. However, as other sources of repayment become inadequate over time, the significance of the collateral’s value increases and the loan may become collateral dependent.

The table below presents the value of individually evaluated, collateral dependent loans by loan class, for borrowers experiencing financial difficulty, as of September 30, 2022 and December 31, 2021:


	Type of Collateral
(dollars in thousands)	Real Estate		Blanket Lien		Equipment		Total
September 30, 2022
Commercial:
Commercial	$	—	$	3,244	$	—	$	3,244
Commercial other	—		—		278		278
Commercial real estate:
Non-owner occupied	12,655		—		—		12,655
Owner occupied	1,336		—		—		1,336
Multi-family	1,873		—		—		1,873



Lease financing	—		—		110		110
Total collateral dependent loans	$	15,864	$	3,244	$	388	$	19,496

December 31, 2021
Commercial:
Commercial	$	—	$	5,402	$	—	$	5,402
Commercial other	—		—		502		502
Commercial real estate:
Non-owner occupied	11,604		—		—		11,604
Owner occupied	1,336		—		—		1,336
Multi-family	1,969		—		—		1,969




Total collateral dependent loans	$	14,909	$	5,402	$	502	$	20,813

The aging status of the recorded investment in loans by portfolio as of September 30, 2022 was as follows:


	Accruing loans
(dollars in thousands)	30-59 days past due		60-89 days past due		Past due 90 days or more		Total past due		Nonaccrual		Current		Total
Commercial:
Commercial	$	7,609	$	518	$	—	$	8,127	$	4,687	$	840,116	$	852,930
Commercial other	3,510		2,189		281		5,980		2,104		675,269		683,353
Commercial real estate:
Commercial real estate non-owner occupied	771		265		—		1,036		13,708		1,552,564		1,567,308
Commercial real estate owner occupied	481		—		—		481		4,222		500,471		505,174
Multi-family	—		—		—		—		9,167		319,306		328,473
Farmland	88		—		—		88		25		65,235		65,348
Construction and land development	—		—		—		—		245		225,304		225,549
Total commercial loans	12,459		2,972		281		15,712		34,158		4,178,265		4,228,135
Residential real estate:
Residential first lien	30		209		77		316		3,517		290,599		294,432
Other residential	197		50		—		247		798		60,748		61,793
Consumer:
Consumer	109		50		—		159		72		109,995		110,226
Consumer other	5,020		3,159		142		8,321		—		1,037,933		1,046,254
Lease financing	3,033		987		193		4,213		1,506		451,892		457,611
Total loans	$	20,848	$	7,427	$	693	$	28,968	$	40,051	$	6,129,432	$	6,198,451

The aging status of the recorded investment in loans by portfolio as of December 31, 2021 was as follows:


	Accruing loans
(dollars in thousands)	30-59 days past due		60-89 days past due		Past due 90 days or more		Total past due		Nonaccrual		Current		Total
Commercial:
Commercial	$	283	$	1,082	$	—	$	1,365	$	6,956	$	762,349	$	770,670
Commercial other	2,402		2,110		5		4,517		4,467		670,534		679,518
Commercial real estate:
Commercial real estate non-owner occupied	585		243		—		828		11,826		1,092,679		1,105,333
Commercial real estate owner occupied	232		730		—		962		3,504		465,192		469,658
Multi-family	—		—		—		—		2,168		169,707		171,875
Farmland	—		26		—		26		155		69,781		69,962
Construction and land development	195		195		—		390		83		193,276		193,749
Total commercial loans	3,697		4,386		5		8,088		29,159		3,423,518		3,460,765
Residential real estate:
Residential first lien	113		285		—		398		3,948		270,066		274,412
Other residential	456		151		—		607		836		62,296		63,739
Consumer:
Consumer	127		20		—		147		110		105,751		106,008
Consumer other	4,423		2,358		1		6,782		—		889,815		896,597
Lease financing	1,253		245		—		1,498		1,510		420,272		423,280
Total loans	$	10,069	$	7,445	$	6	$	17,520	$	35,563	$	5,171,718	$	5,224,801

Troubled Debt Restructurings ("TDRs")

Loans modified as TDRs for commercial and commercial real estate loans generally consist of allowing commercial borrowers to defer scheduled principal payments and make interest only payments for a specified period of time at the stated interest rate of the original loan agreement or lower payments due to a modification of the loans’ contractual terms. TDRs are transferred to nonaccrual status when it is probable that any remaining principal and interest payments due on the loan will not be collected in accordance with the contractual terms of the loan. TDRs that subsequently default are individually evaluated for impairment at the time of default. The outstanding balance of modifications made as a result of COVID, that were not considered TDRs under the Coronavirus Aid, Relief, and Economic Security Act, as amended by Section 541 of the Consolidated Appropriations Act, were $0 at September 30, 2022 and totaled $13.3 million at December 31, 2021.

The Company’s TDRs are identified on a case-by-case basis in connection with the ongoing loan collection processes. The following table presents TDRs by loan portfolio as of September 30, 2022 and December 31, 2021:


	September 30, 2022						December 31, 2021
(dollars in thousands)	Accruing (1)		Non-accrual (2)		Total		Accruing (1)		Non-accrual (2)		Total
Commercial	$	1,727	$	511	$	2,238	$	833	$	1,422	$	2,255
Commercial real estate	113		2,627		2,740		1,522		3,302		4,824
Construction and land development	29		—		29		37		—		37
Residential real estate	3,384		702		4,086		3,128		784		3,912
Consumer	59		—		59		98		—		98
Lease financing	824		21		845		1,394		241		1,635
Total loans	$	6,136	$	3,861	$	9,997	$	7,012	$	5,749	$	12,761

(1)These loans are still accruing interest.

(2)These loans are included in non-accrual loans in the preceding tables.

The allowance for credit losses on TDRs totaled $0.5 million and $0.7 million as of September 30, 2022 and December 31, 2021, respectively. The Company had no unfunded commitments in connection with TDRs at September 30, 2022 and December 31, 2021.

The following table presents a summary of loans by portfolio that were restructured during the three and nine months ended September 30, 2022 and 2021. There were no loans modified as TDRs within the previous twelve months that subsequently defaulted during the three and nine months ended September 30, 2022 or 2021:


	Commercial loan portfolio						Other loan portfolio
(dollars in thousands)	Commercial		Commercial real estate		Construction and land development		Residential real estate		Consumer		Lease financing		Total
For the three months ended September 30, 2022
Troubled debt restructurings:
Number of loans	—		—		—		2		—		—		2
Pre-modification outstanding balance	$	—	$	—	$	—	$	56	$	—	$	—	$	56
Post-modification outstanding balance	—		—		—		56		—		—		56





For the nine months ended September 30, 2022
Troubled debt restructurings:
Number of loans	4		1		—		7		3		2		17
Pre-modification outstanding balance	$	1,324	$	6	$	—	$	260	$	107	$	84	$	1,781
Post-modification outstanding balance	1,324		6		—		260		105		84		1,779





For the three months ended September 30, 2021
Troubled debt restructurings:
Number of loans	2		1		—		—		—		3		6
Pre-modification outstanding balance	$	114	$	152	$	—	$	—	$	—	$	234	$	500
Post-modification outstanding balance	114		130		—		—		—		234		478





For the nine months ended September 30, 2021
Troubled debt restructurings:
Number of loans	7		2		1		3		3		4		20
Pre-modification outstanding balance	$	723	$	1,584	$	49	$	191	$	50	$	739	$	3,336
Post-modification outstanding balance	723		1,562		40		195		50		739		3,309

Credit Quality Monitoring

The Company maintains loan policies and credit underwriting standards as part of the process of managing credit risk. These standards include making loans generally within the Company’s four main regions, which include eastern, northern and southern Illinois and the St. Louis metropolitan area. In addition, our specialty finance division does nationwide bridge lending for FHA and HUD developments and originates loans for multifamily, assisted and senior living and multi-use properties. Our equipment leasing business provides financing to business customers across the country.

The Company has a loan approval process involving underwriting and individual and group loan approval authorities to consider credit quality and loss exposure at loan origination. The loans in the Company’s commercial loan portfolio are risk rated at origination based on the grading system set forth below. All loan authority is based on the aggregate credit to a borrower and its related entities.

The Company’s consumer loan portfolio is primarily comprised of both secured and unsecured loans that are relatively small and are evaluated at origination on a centralized basis against standardized underwriting criteria. The ongoing measurement of credit quality of the consumer loan portfolio is largely done on an exception basis. If payments are made on schedule, as agreed, then no further monitoring is performed. However, if delinquency occurs, the delinquent loans are turned over to the Company’s Consumer Collections Group for resolution. Credit quality for the entire consumer loan portfolio is measured by the periodic delinquency rate, nonaccrual amounts and actual losses incurred.

Loans in the commercial loan portfolio tend to be larger and more complex than those in the other loan portfolio, and therefore, are subject to more intensive monitoring. All loans in the commercial loan portfolio have an assigned relationship manager, and most borrowers provide periodic financial and operating information that allows the relationship managers to stay abreast of credit quality during the life of the loans. The risk ratings of loans in the commercial loan portfolio are reassessed at least annually, with loans below an acceptable risk rating reassessed more frequently and reviewed by various individuals within the Company at least quarterly.

The Company maintains a centralized independent loan review function that monitors the approval process and ongoing asset quality of the loan portfolio, including the accuracy of loan grades. The Company also maintains an independent appraisal review function that participates in the review of all appraisals obtained by the Company.

Credit Quality Indicators

The Company uses a ten grade risk rating system to monitor the ongoing credit quality of its commercial loan portfolio. These loan grades rank the credit quality of a borrower by measuring liquidity, debt capacity, and coverage and payment behavior as shown in the borrower’s financial statements. The risk grades also measure the quality of the borrower’s management and the repayment support offered by any guarantors.

The Company considers all loans with Risk Grades 1 -6 as acceptable credit risks and structures and manages such relationships accordingly. Periodic financial and operating data combined with regular loan officer interactions are deemed adequate to monitor borrower performance. Loans with Risk Grades of 7 are considered "watch credits" categorized as special mention and the frequency of loan officer contact and receipt of financial data is increased to stay abreast of borrower performance. Loans with Risk Grades of 8 - 10 are considered problematic and require special care. Risk Grade 8 is categorized as substandard, 9 as substandard - nonaccrual and 10 as doubtful. Further, loans with Risk Grades of 7 - 10 are managed regularly through a number of processes, procedures and committees, including oversight by a loan administration committee comprised of executive and senior management of the Company, which includes highly structured reporting of financial and operating data, intensive loan officer intervention and strategies to exit, as well as potential management by the Company's Special Assets Group. Loans not graded in the commercial loan portfolio are monitored by aging status and payment activity.

The following tables present the recorded investment of the commercial loan portfolio by risk category as of September 30, 2022 and December 31, 2021:


			September 30, 2022
			Term Loans Amortized Cost Basis by Origination Year
(dollars in thousands)			2022		2021		2020		2019		2018		Prior		Revolving loans		Total
Commercial	Commercial	Acceptable credit quality	$	83,501	$	107,645	$	72,269	$	29,183	$	13,578	$	50,113	$	482,069	$	838,358
		Special mention	—		48		—		314		926		267		1,928		3,483
		Substandard	—		—		—		—		1,385		4,142		875		6,402
		Substandard – nonaccrual	—		340		—		99		112		259		3,877		4,687
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	83,501		108,033		72,269		29,596		16,001		54,781		488,749		852,930

	Commercial other	Acceptable credit quality	207,903		168,275		116,826		73,659		18,985		311		90,558		676,517
		Special mention	—		—		797		2,285		485		—		55		3,622
		Substandard	250		—		—		12		—		—		848		1,110
		Substandard – nonaccrual	343		770		24		473		494		—		—		2,104
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	208,496		169,045		117,647		76,429		19,964		311		91,461		683,353

Commercial real estate	Non-owner occupied	Acceptable credit quality	580,648		437,901		141,562		93,945		18,964		177,967		3,807		1,454,794
		Special mention	1,423		187		482		10,670		198		9,396		—		22,356
		Substandard	593		106		—		36,858		1,611		37,282		—		76,450
		Substandard – nonaccrual	—		744		—		49		10,246		2,669		—		13,708
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	582,664		438,938		142,044		141,522		31,019		227,314		3,807		1,567,308

	Owner occupied	Acceptable credit quality	105,981		131,950		66,624		40,949		29,247		108,957		4,667		488,375
		Special mention	—		135		—		168		159		1,680		24		2,166
		Substandard	45		4,186		575		2,026		—		3,579		—		10,411
		Substandard – nonaccrual	—		385		309		156		333		2,735		304		4,222
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	106,026		136,656		67,508		43,299		29,739		116,951		4,995		505,174

	Multi-family	Acceptable credit quality	188,990		51,461		33,440		445		24,604		15,768		1,020		315,728
		Special mention	—		—		—		—		—		—		—		—
		Substandard	—		—		—		—		—		3,578		—		3,578
		Substandard – nonaccrual	—		949		—		114		—		8,104		—		9,167
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	188,990		52,410		33,440		559		24,604		27,450		1,020		328,473

	Farmland	Acceptable credit quality	5,303		16,267		14,099		4,228		3,250		20,222		1,227		64,596
		Special mention	—		—		—		—		—		161		—		161
		Substandard	—		15		—		23		13		348		167		566
		Substandard – nonaccrual	—		—		—		—		—		25		—		25
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	5,303		16,282		14,099		4,251		3,263		20,756		1,394		65,348

Construction and land development		Acceptable credit quality	81,438		67,959		31,357		8,051		489		1,446		29,913		220,653
		Special mention	—		—		—		—		2,415		210		—		2,625
		Substandard	—		—		—		—		—		—		—		—
		Substandard – nonaccrual	—		—		—		218		—		27		—		245
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	1,649		339		34		—		—		4		—		2,026
		Subtotal	83,087		68,298		31,391		8,269		2,904		1,687		29,913		225,549

Total		Acceptable credit quality	1,253,764		981,458		476,177		250,460		109,117		374,784		613,261		4,059,021
		Special mention	1,423		370		1,279		13,437		4,183		11,714		2,007		34,413
		Substandard	888		4,307		575		38,919		3,009		48,929		1,890		98,517
		Substandard – nonaccrual	343		3,188		333		1,109		11,185		13,819		4,181		34,158
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	1,649		339		34		—		—		4		—		2,026
Total commercial loans			$	1,258,067	$	989,662	$	478,398	$	303,925	$	127,494	$	449,250	$	621,339	$	4,228,135


			December 31, 2021
			Term Loans Amortized Cost Basis by Origination Year
(dollars in thousands)			2021		2020		2019		2018		2017		Prior		Revolving loans		Total
Commercial	Commercial	Acceptable credit quality	$	108,490	$	78,071	$	50,458	$	20,045	$	27,405	$	35,856	$	417,920	$	738,245
		Special mention	186		57		198		6,154		2		316		1,517		8,430
		Substandard	380		372		1,934		1,868		64		4,322		8,099		17,039
		Substandard – nonaccrual	52		—		612		177		242		169		5,704		6,956
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	109,108		78,500		53,202		28,244		27,713		40,663		433,240		770,670

	Commercial other	Acceptable credit quality	264,282		167,326		101,083		29,981		303		341		88,198		651,514
		Special mention	—		1,929		10,676		3,966		—		—		3,252		19,823
		Substandard	688		—		62		341		—		—		2,623		3,714
		Substandard – nonaccrual	10		158		3,894		384		—		—		21		4,467
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	264,980		169,413		115,715		34,672		303		341		94,094		679,518

Commercial real estate	Non-owner occupied	Acceptable credit quality	441,483		154,379		134,507		20,524		55,207		182,465		5,258		993,823
		Special mention	26		6,341		14,177		2,296		711		2,272		—		25,823
		Substandard	6,196		817		8,825		20,572		14,857		22,344		250		73,861
		Substandard – nonaccrual	169		992		6,206		—		195		4,264		—		11,826
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	447,874		162,529		163,715		43,392		70,970		211,345		5,508		1,105,333

	Owner occupied	Acceptable credit quality	141,084		69,415		47,187		35,974		30,583		98,442		1,886		424,571
		Special mention	150		24		187		161		13,087		4,540		32		18,181
		Substandard	4,192		1,127		10,810		205		297		6,466		305		23,402
		Substandard – nonaccrual	—		318		129		336		72		2,649		—		3,504
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	145,426		70,884		58,313		36,676		44,039		112,097		2,223		469,658

	Multi-family	Acceptable credit quality	88,329		20,080		1,973		25,450		1,414		18,642		2,241		158,129
		Special mention	—		451		—		—		—		—		—		451
		Substandard	988		—		—		—		—		10,139		—		11,127
		Substandard – nonaccrual	—		—		123		—		—		2,045		—		2,168
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	89,317		20,531		2,096		25,450		1,414		30,826		2,241		171,875

	Farmland	Acceptable credit quality	15,689		14,966		3,931		3,162		7,996		19,305		1,196		66,245
		Special mention	—		66		1,236		145		153		240		—		1,840
		Substandard	371		76		166		211		—		898		—		1,722
		Substandard – nonaccrual	—		—		—		105		—		—		50		155
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	16,060		15,108		5,333		3,623		8,149		20,443		1,246		69,962

Construction and land development		Acceptable credit quality	65,053		65,274		19,269		10,029		2,511		3,841		19,452		185,429
		Special mention	—		—		5,014		—		—		221		—		5,235
		Substandard	—		1,336		—		—		—		—		—		1,336
		Substandard – nonaccrual	—		—		43		—		—		40		—		83
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	1,465		37		—		—		—		164		—		1,666
		Subtotal	66,518		66,647		24,326		10,029		2,511		4,266		19,452		193,749

Total		Acceptable credit quality	1,124,410		569,511		358,408		145,165		125,419		358,892		536,151		3,217,956
		Special mention	362		8,868		31,488		12,722		13,953		7,589		4,801		79,783
		Substandard	12,815		3,728		21,797		23,197		15,218		44,169		11,277		132,201
		Substandard – nonaccrual	231		1,468		11,007		1,002		509		9,167		5,775		29,159
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	1,465		37		—		—		—		164		—		1,666
Total commercial loans			$	1,139,283	$	583,612	$	422,700	$	182,086	$	155,099	$	419,981	$	558,004	$	3,460,765

The Company evaluates the credit quality of its other loan portfolios, which includes residential real estate, consumer and lease financing loans, based primarily on the aging status of the loan and payment activity. Accordingly, loans on nonaccrual status, loans past due 90 days or more and still accruing interest, and loans modified under troubled debt restructurings are considered to be nonperforming for purposes of credit quality evaluation. The following tables present the recorded investment of our other loan portfolio based on the credit risk profile of loans that are performing and loans that are nonperforming as of September 30, 2022 and December 31, 2021:


			September 30, 2022
			Term Loans Amortized Cost Basis by Origination Year
(dollars in thousands)			2022		2021		2020		2019		2018		Prior		Revolving Loans		Total
Residential real estate	Residential first lien	Performing	$	57,217	$	39,570	$	31,875	$	21,340	$	22,376	$	115,686	$	298	$	288,362
		Nonperforming	102		—		105		195		870		4,798		—		6,070
		Subtotal	57,319		39,570		31,980		21,535		23,246		120,484		298		294,432

	Other residential	Performing	1,381		517		556		1,147		1,568		1,772		53,146		60,087
		Nonperforming	—		—		—		8		10		214		1,474		1,706
		Subtotal	1,381		517		556		1,155		1,578		1,986		54,620		61,793

Consumer	Consumer	Performing	30,643		42,722		10,102		4,397		3,676		16,128		2,426		110,094
		Nonperforming	22		36		8		1		14		50		1		132
		Subtotal	30,665		42,758		10,110		4,398		3,690		16,178		2,427		110,226

	Consumer other	Performing	568,209		300,430		117,490		39,291		7,488		6,188		7,017		1,046,113
		Nonperforming	141		—		—		—		—		—		—		141
		Subtotal	568,350		300,430		117,490		39,291		7,488		6,188		7,017		1,046,254

Leases financing		Performing	149,392		118,613		94,940		63,175		20,649		8,319		—		455,088
		Nonperforming	—		646		883		676		300		18		—		2,523
		Subtotal	149,392		119,259		95,823		63,851		20,949		8,337		—		457,611

Total		Performing	806,842		501,852		254,963		129,350		55,757		148,093		62,887		1,959,744
		Nonperforming	265		682		996		880		1,194		5,080		1,475		10,572
Total other loans			$	807,107	$	502,534	$	255,959	$	130,230	$	56,951	$	153,173	$	64,362	$	1,970,316


			December 31, 2021
			Term Loans Amortized Cost Basis by Origination Year
(dollars in thousands)			2021		2020		2019		2018		2017		Prior		Revolving loans		Total
Residential real estate	Residential first lien	Performing	$	38,508	$	31,920	$	24,311	$	30,842	$	48,276	$	93,462	$	888	$	268,207
		Nonperforming	—		108		173		780		764		4,380		—		6,205
		Subtotal	38,508		32,028		24,484		31,622		49,040		97,842		888		274,412

	Other residential	Performing	888		679		1,520		1,950		1,211		1,559		54,225		62,032
		Nonperforming	—		—		10		16		128		100		1,453		1,707
		Subtotal	888		679		1,530		1,966		1,339		1,659		55,678		63,739

Consumer	Consumer	Performing	65,915		14,955		7,874		8,728		3,025		2,582		2,721		105,800
		Nonperforming	89		5		3		14		24		71		2		208
		Subtotal	66,004		14,960		7,877		8,742		3,049		2,653		2,723		106,008

	Consumer other	Performing	474,385		323,437		63,463		12,635		3,888		5,447		13,341		896,596
		Nonperforming	—		—		—		—		—		—		1		1
		Subtotal	474,385		323,437		63,463		12,635		3,888		5,447		13,342		896,597

Leases financing		Performing	154,803		124,575		86,402		43,536		9,077		1,983		—		420,376
		Nonperforming	—		757		1,001		1,012		95		39		—		2,904
		Subtotal	154,803		125,332		87,403		44,548		9,172		2,022		—		423,280

Total
		Performing	734,499		495,566		183,570		97,691		65,477		105,033		71,175		1,753,011
		Nonperforming	89		870		1,187		1,822		1,011		4,590		1,456		11,025
Total other loans			$	734,588	$	496,436	$	184,757	$	99,513	$	66,488	$	109,623	$	72,631	$	1,764,036

PREMISES, EQUIPMENT AND LEASES

9 Months Ended

Sep. 30, 2022

Property, Plant and Equipment [Abstract]

PREMISES, EQUIPMENT AND LEASES

A summary of premises and equipment at September 30, 2022 and December 31, 2021 is as follows:


(dollars in thousands)	September 30, 2022		December 31, 2021
Land	$	15,803	$	15,696
Buildings and improvements	69,573		67,143
Furniture and equipment	33,946		33,545
Lease right-of-use assets	7,582		8,428
Total	126,904		124,812
Accumulated depreciation	(49,385)		(45,592)
Premises and equipment, net	$	77,519	$	79,220

Depreciation expense for the three and nine months ended September 30, 2022 was $1.2 million and $3.7 million, respectively, and $1.4 million and $4.2 million for the three and nine months ended September 30, 2021, respectively.

The Company has entered into operating leases, primarily for banking offices and operating facilities, which have remaining lease terms of 2 months to 10 years, some of which may include options to extend the lease terms for up to an additional 10 years. The options to extend are included if they are reasonably certain to be exercised. The operating lease liabilities of the Company were $9.5 million and $10.7 million as of September 30, 2022 and December 31, 2021, respectively.

Information related to operating leases for the three and nine months ended September 30, 2022 and 2021 was as follows:


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in thousands)	2022			2021			2022			2021
Operating lease cost	$	533		$	510		$	1,576		$	1,547
Operating cash flows from leases	638			589			1,874			1,975
Right-of-use assets obtained in exchange for lease obligations	80			—			502			689
Right-of-use assets derecognized due to terminations or impairment	—			—			—			(210)
Weighted average remaining lease term	7.3 years			7.8 years			7.3 years			7.8 years
Weighted average discount rate	2.88		%	2.88		%	2.88		%	2.88		%

The projected minimum rental payments under the terms of the leases as of September 30, 2022 were as follows:


(dollars in thousands)	Amount
Year ending December 31:
2022 remaining	$	419
2023	2,185
2024	1,879
2025	975
2026	843
Thereafter	4,296
Total future minimum lease payments	10,597
Less imputed interest	(1,084)
Total operating lease liabilities	$	9,513

LOAN SERVICING RIGHTS

9 Months Ended

Sep. 30, 2022

Transfers and Servicing [Abstract]

LOAN SERVICING RIGHTS

A summary of loan servicing rights at September 30, 2022 and December 31, 2021 is as follows:


	September 30, 2022				December 31, 2021
	Serviced Loans		Carrying Value		Serviced Loans		Carrying Value
Commercial FHA	$	—	$	—	$	2,650,531	$	27,386
SBA	46,799		715		50,043		774
Residential	264,318		582		302,618		705
Commercial FHA held for sale	2,362,462		23,995		—		—
Total	$	2,673,579	$	25,292	$	3,003,192	$	28,865

Commercial FHA Mortgage Loan Servicing

Changes in our commercial FHA loan servicing rights for the three and nine months ended September 30, 2022 and 2021 are summarized as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Loan servicing rights:
Balance, beginning of period	$	24,603	$	33,732	$	27,386	$	38,322

Servicing rights transferred to held for sale	(23,995)		—		(23,995)		—
Amortization	(608)		(721)		(1,907)		(2,284)
Refinancing fee received from third party	—		165		(221)		(439)
Permanent impairment	—		(3,037)		(1,263)		(5,460)
Balance, end of period	$	—	$	30,139	$	—	$	30,139






Fair value:
At beginning of period	$	26,865	$	34,255	$	28,368	$	38,322
At end of period	—		31,012		—		31,012

At September 30, 2022, the Company had committed to a plan to sell commercial FHA servicing rights and therefore transferred $24.0 million to commercial FHA servicing rights held for sale. Servicing rights held for sale are recorded at the lower of their carrying amount or fair value less estimated costs to sell. No impairment was recognized in the third quarter of 2022.

The fair value of commercial FHA loan servicing rights is determined using key assumptions, representing both general economic and other published information, including the assumed earnings rates related to escrow and replacement reserves, and the weighted average characteristics of the commercial portfolio, including the prepayment rate and discount rate. The prepayment rate considers many factors as appropriate, including lockouts, balloons, prepayment penalties, interest rate ranges, delinquencies and geographic location. The discount rate is based on an average pre-tax internal rate of return utilized by market participants in pricing the servicing portfolio. Significant increases or decreases in any one of these assumptions would result in a significantly lower or higher fair value measurement. The weighted average prepayment rate was 8.21% and 8.24% at September 30, 2022 and December 31, 2021, respectively, while the weighted average discount rate was 11.48% and 11.87% for the same periods, respectively.

- Definition

The entire disclosure for a transferor's continuing involvement in financial assets that it has transferred in a securitization or asset-backed financing arrangement, the nature of any restrictions on assets reported by an entity in its statement of financial position that relate to a transferred financial asset (including the carrying amounts of such assets), how servicing assets and servicing liabilities are reported, and (for securitization or asset-backed financing arrangements accounted for as sales) when a transferor has continuing involvement with the transferred financial assets and transfers of financial assets accounted for as secured borrowings, how the transfer of financial assets affects an entity's financial position, financial performance, and cash flows.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 860
-SubTopic 30
-Section 50
-Paragraph 1A
-Subparagraph (c)(3)
-URI https://asc.fasb.org/extlink&oid=109249958&loc=SL6224234-111729

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 30
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-Paragraph 1A
-Subparagraph (b)(2)
-URI https://asc.fasb.org/extlink&oid=109249958&loc=SL6224234-111729

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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-SubTopic 20
-Section 50
-Paragraph 3
-Subparagraph (b)(2)(ii)
-URI https://asc.fasb.org/extlink&oid=121570589&loc=d3e107207-111719

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 860
-SubTopic 50
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-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=128311188&loc=d3e122596-111746

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/extlink&oid=121570589&loc=SL51823488-111719

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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-Publisher FASB
-Name Accounting Standards Codification
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-Publisher FASB
-Name Accounting Standards Codification
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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-URI https://asc.fasb.org/extlink&oid=109249958&loc=SL34722452-111729

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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Reference 16: http://www.xbrl.org/2003/role/disclosureRef
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Reference 17: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

GOODWILL AND INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS

The carrying amount of goodwill by segment at September 30, 2022 and December 31, 2021 is summarized as follows:


(dollars in thousands)	September 30, 2022		December 31, 2021
Banking	$	157,158	$	157,158

Wealth management	4,746		4,746
Total goodwill	$	161,904	$	161,904

The Company’s intangible assets, consisting of core deposit and customer relationship intangibles, as of September 30, 2022 and December 31, 2021 are summarized as follows:


	September 30, 2022						December 31, 2021
(dollars in thousands)	Gross carrying amount		Accumulated amortization		Total		Gross carrying amount		Accumulated amortization		Total
Core deposit intangibles	$	58,913	$	(43,708)	$	15,205	$	57,012	$	(40,603)	$	16,409
Customer relationship intangibles	15,919		(8,926)		6,993		15,918		(7,953)		7,965
Total intangible assets	$	74,832	$	(52,634)	$	22,198	$	72,930	$	(48,556)	$	24,374

In conjunction with the FNBC branch acquisition, the Company recorded $1.9 million of core deposit intangibles, which are being amortized on an accelerated basis over an estimated useful life of 10 years.

Amortization of intangible assets was $1.4 million and $4.1 million for the three and nine months ended September 30, 2022, respectively, and $1.4 million and $4.4 million for the comparable periods in 2021, respectively

DERIVATIVE INSTRUMENTS

9 Months Ended

Sep. 30, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE INSTRUMENTS

As part of the Company’s overall management of interest rate sensitivity, the Company utilizes derivative instruments to minimize significant, unanticipated earnings fluctuations caused by interest rate volatility, including interest rate lock commitments, forward commitments to sell mortgage-backed securities, cash flow hedges and interest rate swap contracts.

Interest Rate Lock Commitments / Forward Commitments to Sell Mortgage-Backed Securities

The Company issues interest rate lock commitments on originated fixed-rate commercial and residential real estate loans to be sold. The interest rate lock commitments and loans held for sale are hedged with forward contracts to sell mortgage-backed securities. The fair value of the interest rate lock commitments and forward contracts to sell mortgage-backed securities are included in other assets or other liabilities in the consolidated balance sheets. Changes in the fair value of derivative financial instruments are recognized in commercial FHA revenue and residential mortgage banking revenue in the consolidated statements of income.

The following table summarizes the interest rate lock commitments and forward commitments to sell mortgage-backed securities held by the Company, their notional amount and estimated fair values at September 30, 2022 and December 31, 2021:


	Notional amount				Fair value gain
(dollars in thousands)	September 30, 2022		December 31, 2021		September 30, 2022		December 31, 2021
Derivative instruments (included in other assets):
Interest rate lock commitments	$	4,419	$	66,216	$	(15)	$	410
Forward commitments to sell mortgage-backed securities	11,054		60,427		165		—
Total	$	15,473	$	126,643	$	150	$	410


	Notional amount				Fair value loss
(dollars in thousands)	September 30, 2022		December 31, 2021		September 30, 2022		December 31, 2021
Derivative instruments (included in other liabilities):
Interest rate lock commitments	$	9,138	$	—	$	317	$	—
Forward commitments to sell mortgage-backed securities	—		18,362		—		19
Total	$	9,138	$	18,362	$	317	$	19

During the three and nine months ended September 30, 2022, the Company recognized net losses of $0.2 million and $0.6 million, respectively, on derivative instruments in commercial FHA revenue and residential mortgage banking revenue in the consolidated statements of income.

During the three and nine months ended September 30, 2021, the Company recognized net losses of $0.4 million and $1.3 million, respectively, on derivative instruments in commercial FHA revenue and residential mortgage banking revenue in the consolidated statements of income.

Cash Flow Hedges

In the first quarter of 2022, the Company entered into interest rate swap agreements, which qualify as cash flow hedges, to manage the risk of changes in future cash flows due to interest rate fluctuations. The following table summarizes the Company's receive-fixed, pay-variable interest rate swaps on certain pools of loans indexed to prime at September 30, 2022:


(dollars in thousands)	September 30, 2022
Notional Amount	$	200,000
Fair value loss included in other liabilities	(10,734)
Tax effected amount included in accumulated other comprehensive (loss) income	(7,836)
Average remaining life	3.6 years
Weighted average pay rate	6.25		%
Weighted average receive rate	5.48		%

The Company has future-starting receive-fixed, pay-variable interest rate swaps on certain FHLB or other fixed-rate advances. These swaps are effective beginning in April 2023. The Company pays or receives the net interest amount quarterly based on the respective hedge agreement and includes the amount as part of FHLB advances interest expense on the consolidated statements of income.


(dollars in thousands)	September 30, 2022		December 31, 2021
Notional Amount	$	140,000	$	140,000
Fair value gain included in other assets	16,422		5,095
Tax effected amount included in accumulated other comprehensive (loss) income	11,988		3,694

Quarterly, the effectiveness evaluation of the above cash flow hedges is based on the fluctuation of the variable interest the Company receives from the customers for the loans as compared to the fixed interest rate received from the counterparty. There were no amounts recorded in the consolidated statements of income for the three and nine months ended September 30, 2022, related to ineffectiveness.

Interest Rate Swap Contracts Not Designated as Hedges

The Company entered into interest rate swap contracts sold to commercial customers who wish to modify their interest rate sensitivity. These swaps are offset by contracts simultaneously purchased by the Company from other financial dealer institutions with mirror-image terms. Because of the mirror-image terms of the offsetting contracts, in addition to collateral provisions which mitigate the impact of non-performance risk, changes in the fair value subsequent to initial recognition have a minimal effect on earnings. These derivative contracts do not qualify for hedge accounting.

The notional amounts of the customer derivative instruments and the offsetting counterparty derivative instruments were $7.6 million and $7.9 million at September 30, 2022 and December 31, 2021, respectively. The fair value of the customer derivative instruments and the offsetting counterparty derivative instruments was $0.5 million and $0.4 million at September 30, 2022 and December 31, 2021, respectively, which are included in other assets and other liabilities, respectively, on the consolidated balance sheets.

DEPOSITS

9 Months Ended

Sep. 30, 2022

Deposits [Abstract]

DEPOSITS

The following table summarizes the classification of deposits as of September 30, 2022 and December 31, 2021:


(dollars in thousands)	September 30, 2022		December 31, 2021
Noninterest-bearing demand	$	2,025,237	$	2,245,701
Interest-bearing:
Checking	1,905,439		1,663,021
Money market	1,125,333		869,067
Savings	704,245		679,115
Time	634,998		653,744
Total deposits	$	6,395,252	$	6,110,648

SHORT-TERM BORROWINGS

9 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

SHORT-TERM BORROWINGS

The following table presents the distribution of short-term borrowings and related weighted average interest rates as of September 30, 2022 and December 31, 2021:


	Repurchase agreements
(dollars in thousands)	As of and for the Nine Months Ended September 30, 2022			As of and for the Year Ended December 31, 2021
Outstanding at period-end	$	58,518		$	76,803
Average amount outstanding	62,495			68,986
Maximum amount outstanding at any month end	76,807			77,497
Weighted average interest rate:
During period	0.16		%	0.12		%
End of period	0.26		%	0.13		%

Securities sold under agreements to repurchase, which are classified as secured borrowings, generally mature within one to four days from the transaction date. Securities sold under agreements to repurchase are reflected at the amount of cash received in connection with the transaction, which represents the amount of the Bank’s obligation. The Bank may be required to provide additional collateral based on the fair value of the underlying securities. Investment securities with a carrying amount of $61.5 million and $78.3 million at September 30, 2022 and December 31, 2021, respectively, were pledged for securities sold under agreements to repurchase.

The Company had available lines of credit of $13.5 million and $55.9 million at September 30, 2022 and December 31, 2021, respectively, from the Federal Reserve Discount Window. The lines are collateralized by a collateral agreement with respect to a pool of commercial real estate loans totaling $15.7 million and $64.8 million at September 30, 2022 and December 31, 2021, respectively. There were no outstanding borrowings under these lines at September 30, 2022 and December 31, 2021.

At September 30, 2022, the Company had available federal funds lines of credit totaling $45.0 million. These lines of credit were unused at September 30, 2022.

FHLB ADVANCES AND OTHER BORROWINGS

9 Months Ended

Sep. 30, 2022

FHLB ADVANCES AND OTHER BORROWINGS

FHLB ADVANCES AND OTHER BORROWINGS

The following table summarizes our FHLB advances and other borrowings as of September 30, 2022 and December 31, 2021:


(dollars in thousands)	September 30, 2022		December 31, 2021
Midland States Bancorp, Inc.
Revolving line of credit - variable interest rate equivalent to Daily Simple SOFR plus 1.60%	$	—	$	—
Series G redeemable preferred stock - 171 shares at $1,000 per share	—		171
Midland States Bank
FHLB advances – putable fixed rate at rates averaging 2.35% and 1.48% at September 30, 2022 and December 31, 2021, respectively – maturing through December 2024	110,000		210,000
FHLB advances –SOFR floater at rates averaging 4.60% and 1.67% at September 30, 2022 and December 31, 2021, respectively – maturing in October 2023	100,000		100,000
FHLB advances – Short term fixed rate at rates averaging 3.14% at September 30, 2022 – maturing in October 2022	150,000		—
Total FHLB advances and other borrowings	$	360,000	$	310,171

The Company’s advances from the FHLB are collateralized by a blanket collateral agreement of qualifying mortgage and home equity line of credit loans and certain commercial real estate loans totaling approximately $2.71 billion and $2.10 billion at September 30, 2022 and December 31, 2021, respectively.

On October 12, 2021, the Company entered into a loan agreement with another bank for a revolving line of credit in the original principal amount of up to $15.0 million. The loan matured on October 11, 2022.

SUBORDINATED DEBT

9 Months Ended

Sep. 30, 2022

Subordinated Borrowings [Abstract]

SUBORDINATED DEBT

The following table summarizes the Company’s subordinated debt as of September 30, 2022 and December 31, 2021:


(dollars in thousands)	September 30, 2022		December 31, 2021
Subordinated debt issued June 2015 – fixed interest rate of 6.50%, $550 - maturing June 18, 2025	$	547	$	546
Subordinated debt issued October 2017 – fixed interest rate of 6.25% through October 2022 and a variable interest rate equivalent to three month LIBOR plus 4.23% thereafter, $40,000 - maturing October 15, 2027	39,674		39,626
Subordinated debt issued September 2019 – fixed interest rate of 5.00% through September 2024 and a variable interest rate equivalent to three month SOFR plus 3.61% thereafter, $72,750 - maturing September 30, 2029	72,236		72,042
Subordinated debt issued September 2019 – fixed interest rate of 5.50% through September 2029 and a variable interest rate equivalent to three month SOFR plus 4.05% thereafter, $27,250 - maturing September 30, 2034	26,913		26,877
Total subordinated debt	$	139,370	$	139,091

The subordinated debentures may be included in Tier 2 capital (with certain limitations applicable) under current regulatory guidelines and interpretations.

On October 15, 2022, the Company redeemed the outstanding Fixed-to-Floating Rate Subordinated Notes due October 15, 2027, having an aggregate principal amount of $40.0 million, in accordance with the terms of the notes. The aggregate redemption price was 100% of the aggregate principal amount of the subordinated notes, plus accrued and unpaid interest. The interest rate on the subordinated notes was 6.25%, equating to approximately $2.5 million of interest expense, annually.

PREFERRED STOCK	9 Months Ended
PREFERRED STOCK	Sep. 30, 2022
Equity [Abstract]
PREFERRED STOCK	PREFERRED STOCKOn August 24, 2022, the Company issued and sold 4,600,000 depositary shares (the "Depositary Shares"), each representing a 1/40th ownership interest in a share of the Company's 7.75% fixed-rate reset non-cumulative perpetual preferred stock, Series A, par value $2.00 per share (the "Series A preferred stock"), with a liquidation preference of $25 per depositary share (equivalent to $1,000 per share of Series A Preferred Stock). The Series A preferred stock qualifies as Tier 1 capital for purposes of regulatory capital calculations. The gross proceeds were $115.0 million while net proceeds from the issuance of the Series A preferred stock, after deducting $4.5 million of offering costs, including the underwriting discount and other expenses, were $110.5 million. Dividends on the Series A preferred stock will not be cumulative or mandatory, and will be paid when, as, and if declared by the Company’s board of directors. If declared, dividends will accrue and be payable, quarterly in arrears, (i) from and including the date of original issuance to, but excluding September 30, 2027 or the date of earlier redemption, at a rate of 7.75% per annum, on March 30, June 30, September 30 and December 30 of each year, commencing on December 30, 2022, and (ii) from and including September 30, 2027, during each reset period, at a rate per annum equal to the five-year treasury rate as of the most recent reset dividend determination date plus 4.713%, on March 30, June 30, September 30 and December 30 of each year, beginning on December 30, 2027, except in each case where such day is not a business day. If the Company’s board of directors does not declare a dividend on the Series A preferred stock in respect of a dividend period, then no dividend shall be deemed to be payable for such dividend period, or be cumulative, and the Company will have no obligation to pay any dividend for that dividend period, whether or not the board of directors declares a dividend on the Series A preferred stock or any other class or series of the Company's capital stock for any future dividend period. Additionally, so long as any share of Series A preferred stock remains outstanding, unless dividends on all outstanding shares of Series A preferred stock for the most recently completed dividend period have been paid in full or declared and a sum sufficient for the payment thereof has been set aside for payment, no dividend shall be declared or paid or set aside for payment and no distribution shall be declared or made or set aside for payment on the Company’s common stock. The Series A preferred stock is perpetual and has no maturity date. The Series A preferred stock is not subject to any mandatory redemption, sinking fund, or other similar provisions. The Company, at its option and subject to prior regulatory approval, may redeem the Series A preferred stock (i) in whole or in part, from time to time, on any dividend payment date on or after September 30, 2027, or (ii) in whole but not in part at any time within 90 days following a regulatory capital treatment event, in each case, at a redemption price equal to $1,000 per share of Series A preferred stock (equivalent to $25 per Depositary Share), plus any declared and unpaid dividends, without regard to any undeclared dividends, to but excluding the redemption date. Neither the holders of the Series A preferred stock nor holders of the Depositary Shares will have the right to require the redemption or repurchase of the Series A preferred stock.

EARNINGS PER COMMON SHARE

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

EARNINGS PER COMMON SHARE

EARNINGS PER COMMON SHAREEarnings per common share is calculated utilizing the two-class method. Basic earnings per common share is calculated by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding. Diluted earnings per common share is calculated by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of shares adjusted for the dilutive effect of common stock awards. The diluted earnings per common share computation for both the three and nine months ended September 30, 2022 excluded antidilutive stock options of 45,698 and excluded antidilutive stock options of 69,145 for the comparable periods in 2021, respectively, because the exercise prices of these stock options exceeded the average market prices of the Company’s common shares for

those respective periods. Presented below are the calculations for basic and diluted earnings per common share for the three and nine months ended September 30, 2022 and 2021:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands, except per share data)	2022		2021		2022		2021
Net income	$	23,521	$	19,548	$	66,153	$	58,210



Common shareholder dividends	(6,400)		(6,239)		(19,186)		(18,741)
Unvested restricted stock award dividends	(70)		(60)		(218)		(186)
Undistributed earnings to unvested restricted stock awards	(185)		(126)		(519)		(386)
Undistributed earnings to common shareholders	$	16,866	$	13,123	$	46,230	$	38,897
Basic
Distributed earnings to common shareholders	$	6,400	$	6,239	$	19,186	$	18,741
Undistributed earnings to common shareholders	16,866		13,123		46,230		38,897
Total common shareholders earnings, basic	$	23,266	$	19,362	$	65,416	$	57,638
Diluted
Distributed earnings to common shareholders	$	6,400	$	6,239	$	19,186	$	18,741
Undistributed earnings to common shareholders	16,866		13,123		46,230		38,897
Total common shareholders earnings	23,266		19,362		65,416		57,638
Add back:
Undistributed earnings reallocated from unvested restricted stock awards	—		—		1		1
Total common shareholders earnings, diluted	$	23,266	$	19,362	$	65,417	$	57,639
Weighted average common shares outstanding, basic	22,338,828		22,520,499		22,306,323		22,544,898
Options	51,610		57,381		60,772		69,074
Weighted average common shares outstanding, diluted	22,390,438		22,577,880		22,367,095		22,613,972
Basic earnings per common share	$	1.04	$	0.86	$	2.93	$	2.56
Diluted earnings per common share	1.04		0.86		2.92		2.55

FAIR VALUE OF FINANCIAL INSTRUMENTS

9 Months Ended

Sep. 30, 2022

Fair Value Disclosures [Abstract]

FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date reflecting assumptions that a market participant would use when pricing an asset or liability. The hierarchy uses three levels of inputs to measure the fair value of assets and liabilities as follows:

•Level 1: Unadjusted quoted prices for identical assets or liabilities traded in active markets.

•Level 2: Significant other observable inputs other than Level 1, including quoted prices for similar assets and liabilities in active markets, quoted prices in less active markets, or other observable inputs that can be corroborated by observable market data.

•Level 3: Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

Assets and liabilities measured and recorded at fair value, including financial assets for which the Company has elected the fair value option, on a recurring and nonrecurring basis at September 30, 2022 and December 31, 2021, are summarized below:


	September 30, 2022
(dollars in thousands)	Carrying amount		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets and liabilities measured at fair value on a recurring basis:
Assets
Investment securities available for sale:
U.S. Treasury securities	$	60,496	$	60,496	$	—	$	—
U.S. government sponsored entities and U.S. agency securities	27,865		—		27,865		—
Mortgage-backed securities - agency	391,615		—		391,615		—
Mortgage-backed securities - non-agency	21,158		—		21,158		—
State and municipal securities	95,061		—		95,061		—
Corporate securities	85,694		—		85,694		—
Equity securities	8,615		8,615		—		—
Loans held for sale	4,338		—		4,338		—
Derivative assets	17,033		—		17,033		—

Total	$	711,875	$	69,111	$	642,764	$	—
Liabilities
Derivative liabilities	$	11,512	$	—	$	11,512	$	—

Total	$	11,512	$	—	$	11,512	$	—

Assets measured at fair value on a non-recurring basis:
Loan servicing rights	$	1,297	$	—	$	—	$	1,297
Commercial FHA mortgage servicing rights held for sale	23,995		—		—		23,995
Nonperforming loans	46,882		11,516		25,128		10,238
Other real estate owned	11,141		—		11,141		—
Assets held for sale	1,271		—		1,271		—


	December 31, 2021
(dollars in thousands)	Carrying amount		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets and liabilities measured at fair value on a recurring basis:
Assets
Investment securities available for sale:
U.S. Treasury securities	$	64,917	$	64,917	$	—	$	—
U.S. government sponsored entities and U.S. agency securities	33,817		—		33,817		—
Mortgage-backed securities - agency	440,270		—		440,270		—
Mortgage-backed securities - non-agency	28,706		—		28,706		—
State and municipal securities	143,099		—		143,099		—
Corporate securities	195,794		—		194,859		935
Equity securities	9,529		9,529		—		—
Loans held for sale	32,045		—		32,045		—
Derivative assets	5,883		—		5,883		—

Total	$	954,060	$	74,446	$	878,679	$	935
Liabilities
Derivative liabilities	$	397	$	—	$	397	$	—

Total	$	397	$	—	$	397	$	—

Assets measured at fair value on a non-recurring basis:
Loan servicing rights	$	28,865	$	—	$	—	$	28,865

Nonperforming loans	36,542		24,358		6,129		6,055
Other real estate owned	12,059		—		12,059		—
Assets held for sale	2,284		—		2,284		—

The following table provides a reconciliation of activity for assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three and nine months ended September 30, 2022 and 2021:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Balance, beginning of period	$	—	$	1,008	$	935	$	959
Transferred to level 2	—		—		(935)		—
Total realized in earnings (1)	—		4		6		10
Total unrealized in other comprehensive income (2)	—		(73)				(24)
Net settlements (principal and interest)	—		(4)		(6)		(10)
Balance, end of period	$	—	$	935	$	—	$	935

(1)Amounts included in interest income from investment securities taxable in the consolidated statements of income.

(2)Represents change in unrealized gains or losses for the period included in other comprehensive income for assets held at the end of the reporting period.

The following table provides quantitative information about significant unobservable inputs used in fair value measurements of Level 3 assets measured at fair value on a recurring basis at December 31, 2021:

(dollars in thousands)

Fair value

Valuation
technique

Unobservable
input / assumptions

Range (weighted average)(1)

December 31, 2021

Corporate securities

935

Consensus pricing

Net market price

0.0% - 7.0% (4.5)%

(1)Unobservable inputs were weighted by the relative fair value of the instruments.

The significant unobservable inputs used in the fair value measurement of the Company’s corporate securities is net market price. The corporate securities are not actively traded, and as a result, fair value is determined utilizing third-party valuation services through consensus pricing. Significant changes in any of the inputs in isolation would result in a significant change to the fair value measurement. Generally, net market price increases when market interest rates decline and declines when market interest rates increase.

The following table presents losses recognized on assets measured on a nonrecurring basis for the three and nine months ended September 30, 2022 and 2021:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Commercial mortgage servicing rights	$	—	$	3,037	$	1,263	$	5,460
Residential mortgage servicing rights held for sale	—		79		—		222
Nonperforming loans	1,423		3,405		6,381		9,677
Other real estate owned	339		9		743		426
Assets held for sale	—		—		—		—
Total losses on assets measured on a nonrecurring basis	$	1,762	$	6,530	$	8,387	$	15,785

The following tables present quantitative information about significant unobservable inputs used in fair value measurements of Level 3 assets measured on a nonrecurring basis at September 30, 2022 and December 31, 2021:

(dollars in thousands)

Fair value

Valuation
technique

Unobservable
input / assumptions

Range (weighted average)(1)

September 30, 2022

Loan servicing rights:

SBA servicing rights

715

Discounted cash flow

Prepayment speed

14.21% - 15.40% (14.95%)

Discount rate

No range (11.50%)

Residential servicing rights

582

Discounted cash flow

Prepayment speed

7.56% -31.14% (8.46%)

Discount rate

9.00% - 11.50% (10.13%)

Commercial FHA servicing rights held for sale

23,995

Discounted cash flow

Prepayment speed

8.00% - 18.00% (8.21%)

Discount rate

10.00% - 27.00% (11.48%)

December 31, 2021

Loan servicing rights:

Commercial MSR

28,368

Discounted cash flow

Prepayment speed

8.00% - 18.00% (8.24%)

Discount rate

10.00% - 27.00% (11.87%)

SBA servicing rights

898

Discounted cash flow

Prepayment speed

12.27% - 14.14% (13.88%)

Discount rate

10.00% - 12.00% (11.00%)

Residential servicing rights

705

Discounted cash flow

Prepayment speed

11.94% - 27.48% (14.94%)

Discount rate

9.00% - 11.50% (10.25%)

(1)Unobservable inputs were weighted by the relative fair value of the instruments.

ASC Topic 825, Financial Instruments, requires disclosure of the estimated fair value of certain financial instruments and the methods and significant assumptions used to estimate such fair values. Additionally, certain financial instruments and all nonfinancial instruments are excluded from the applicable disclosure requirements.

The Company has elected the fair value option for newly originated commercial and residential loans held for sale. These loans are intended for sale and are hedged with derivative instruments. We have elected the fair value option

to mitigate accounting mismatches in cases where hedge accounting is complex and to achieve operational simplification.

The following table presents the difference between the aggregate fair value and the aggregate remaining principal balance for loans for which the fair value option has been elected as of September 30, 2022 and December 31, 2021:


	September 30, 2022						December 31, 2021
(dollars in thousands)	Aggregate fair value		Difference		Contractual principal		Aggregate fair value		Difference		Contractual principal
Commercial loans held for sale	$	—	$	—	$	—	$	19,230	$	—	$	19,230
Residential loans held for sale	4,338		(73)		4,411		12,815		584		12,231

Total loans held for sale	$	4,338	$	(73)	$	4,411	$	32,045	$	584	$	31,461

The following table presents the amount of losses from fair value changes included in income before income taxes for financial assets carried at fair value for the three and nine months ended September 30, 2022 and 2021:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Commercial loans held for sale	$	—	$	—	$	—	$	(67)
Residential loans held for sale	(280)		(231)		(557)		(294)
Total loans held for sale	$	(280)	$	(231)	$	(557)	$	(361)

The carrying values and estimated fair value of certain financial instruments not carried at fair value at September 30, 2022 and December 31, 2021 were as follows:


	September 30, 2022
(dollars in thousands)	Carrying amount		Fair value		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets
Cash and due from banks	$	309,531	$	309,531	$	309,531	$	—	$	—
Federal funds sold	3,657		3,657		3,657		—		—

Loans, net	6,139,812		6,025,586		—		—		6,025,586
Accrued interest receivable	17,537		17,537		—		17,537		—

Liabilities
Deposits	$	6,395,252	$	6,370,773	$	—	$	6,370,773	$	—
Short-term borrowings	58,518		58,518		—		58,518		—
FHLB and other borrowings	360,000		358,694		—		358,694		—
Subordinated debt	139,370		135,279		—		135,279		—
Trust preferred debentures	49,824		54,965		—		54,965		—


	December 31, 2021
(dollars in thousands)	Carrying amount		Fair value		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets
Cash and due from banks	$	673,297	$	673,297	$	673,297	$	—	$	—
Federal funds sold	7,074		7,074		7,074		—		—

Loans, net	5,173,739		5,221,886		—		—		5,221,886
Accrued interest receivable	19,470		19,470		—		19,470		—

Liabilities
Deposits	$	6,110,648	$	6,109,077	$	—	$	6,109,077	$	—
Short-term borrowings	76,803		76,803		—		76,803		—
FHLB and other borrowings	310,171		317,464		—		317,464		—
Subordinated debt	139,091		148,386		—		148,386		—
Trust preferred debentures	49,374		57,827		—		57,827		—

In accordance with our adoption of ASU 2016-1 in 2019, the methods utilized to measure fair value of financial instruments at September 30, 2022 and December 31, 2021 represent an approximation of exit price; however, an actual exit price may differ.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

COMMITMENTS, CONTINGENCIES AND CREDIT RISK

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS, CONTINGENCIES AND CREDIT RISK

In the normal course of business, there are outstanding various contingent liabilities such as claims and legal actions, which are not reflected in the consolidated financial statements. No material losses are anticipated as a result of these actions or claims.

We are a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of our customers. These financial instruments include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the balance sheet. The contract amounts of those instruments reflect the extent of involvement we have in particular classes of financial instruments.

Our exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. The Bank used the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. The commitments are principally tied to variable rates. Loan commitments as of September 30, 2022 and December 31, 2021 were as follows:


(dollars in thousands)	September 30, 2022		December 31, 2021
Commitments to extend credit	$	1,280,312	$	994,709
Financial guarantees – standby letters of credit	31,315		14,325

The Company establishes a mortgage repurchase liability to reflect management’s estimate of losses on loans for which the Company could have a repurchase obligation based on the volume of loans sold in 2022 and years prior, borrower default expectations, historical investor repurchase demand and appeals success rates, and estimated loss severity. Loans repurchased from investors are initially recorded at fair value, which becomes the Company’s new accounting basis. Any difference between the loan’s fair value and the outstanding principal amount is charged or credited to the mortgage repurchase liability, as appropriate. Subsequent to repurchase, such loans are carried in loans receivable. There were no losses as a result of make-whole requests and loan repurchases for the three and nine months ended September 30, 2022 and 2021. The liability for unresolved repurchase demands totaled $0.2 million and $0.2 million at September 30, 2022 and December 31, 2021, respectively.

SEGMENT INFORMATION

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATIONOur business segments are defined as Banking, Wealth Management, and Other. The reportable business segments are consistent with the internal reporting and evaluation of the principle lines of business of the Company. The Banking segment provides a wide range of financial products and services to consumers and businesses, including commercial, commercial real estate, mortgage and other consumer loan products; commercial equipment leasing; mortgage loan sales and servicing; letters of credit; various types of deposit products, including checking, savings and time deposit accounts; merchant services; and corporate treasury management services. The Wealth Management segment consists of trust and fiduciary services, brokerage and retirement planning services. The Other segment includes the operating results of the parent company, our captive insurance business unit, and the elimination of intercompany transactions.

Selected business segment financial information for the three and nine months ended September 30, 2022 and 2021 were as follows:


(dollars in thousands)	Banking		Wealth Management		Other		Total
Three Months Ended September 30, 2022
Net interest income (expense)	$	66,846	$	—	$	(2,822)	$	64,024
Provision for credit losses	6,974		—		—		6,974
Noninterest income	9,646		6,199		(19)		15,826
Noninterest expense	39,338		4,364		(206)		43,496
Income (loss) before income taxes (benefit)	30,180		1,835		(2,635)		29,380
Income taxes (benefit)	9,238		498		(3,877)		5,859
Net income (loss)	$	20,942	$	1,337	$	1,242	$	23,521
Total assets	$	7,809,280	$	29,166	$	(16,569)	$	7,821,877

Nine Months Ended September 30, 2022
Net interest income (expense)	$	190,162	$	—	$	(7,977)	$	182,185
Provision for credit losses	16,582		—		—		16,582
Noninterest income	26,547		19,481		24		46,052
Noninterest expense	112,947		13,130		(358)		125,719
Income (loss) before income taxes (benefit)	87,180		6,351		(7,595)		85,936
Income taxes (benefit)	23,498		1,761		(5,476)		19,783
Net income (loss)	$	63,682	$	4,590	$	(2,119)	$	66,153
Total assets	$	7,809,280	$	29,166	$	(16,569)	$	7,821,877

Three Months Ended September 30, 2021
Net interest income (expense)	$	53,888	$	—	$	(2,492)	$	51,396
Provision for credit losses	(184)		—		—		(184)
Noninterest income	7,917		7,175		51		15,143
Noninterest expense	37,055		4,507		(270)		41,292
Income (loss) before income taxes (benefit)	24,934		2,668		(2,171)		25,431
Income taxes (benefit)	4,973		764		146		5,883
Net income (loss)	$	19,961	$	1,904	$	(2,317)	$	19,548
Total assets	$	7,091,180	$	31,274	$	(28,495)	$	7,093,959

Nine Months Ended September 30, 2021
Net interest income (expense)	$	161,514	$	—	$	(8,140)	$	153,374
Provision for credit losses	2,926		—		—		2,926
Noninterest income	27,649		19,635		92		47,376
Noninterest expense	117,655		12,672		(1,015)		129,312
Income (loss) before income taxes (benefit)	68,582		6,963		(7,033)		68,512
Income taxes (benefit)	9,849		1,967		(1,514)		10,302
Net income (loss)	$	58,733	$	4,996	$	(5,519)	$	58,210
Total assets	$	7,091,180	$	31,274	$	(28,495)	$	7,093,959

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Paragraph 31
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

REVENUE FROM CONTRACTS WITH CUSTOMERS

9 Months Ended

Sep. 30, 2022

Revenue from Contract with Customer [Abstract]

REVENUE FROM CONTRACTS WITH CUSTOMERS

The Company’s revenue from contracts with customers in the scope of Topic 606 is recognized within noninterest income in the consolidated statements of income. The following presents noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the three and nine months ended September 30, 2022 and 2021.


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Noninterest income - in-scope of Topic 606
Wealth management revenue:
Trust management/administration fees	$	5,241	$	5,623	$	16,362	$	15,054
Investment advisory fees	—		577		—		1,462
Investment brokerage fees	482		330		1,623		1,206
Other	476		645		1,496		1,913
Service charges on deposit accounts:
Nonsufficient fund fees	1,775		1,470		4,631		3,814
Other	822		798		2,338		2,196
Interchange revenues	3,531		3,651		10,401		10,823
Other income:
Merchant services revenue	448		405		1,203		1,137
Other	847		925		2,286		3,135
Noninterest income - out-of-scope of Topic 606	2,204		719		5,712		6,636
Total noninterest income	$	15,826	$	15,143	$	46,052	$	47,376

Topic 606 does not apply to revenue associated with financial instruments, including revenue from loans and investment securities. In addition, certain noninterest income streams such as commercial FHA revenue, residential mortgage banking revenue and gain on sales of investment securities, net, are also not in scope of Topic 606. Topic 606 is applicable to noninterest income streams such as wealth management revenue, service charges on deposit accounts, interchange revenue, gain on sales of other real estate owned, and certain other noninterest income streams. The noninterest income streams considered in-scope by Topic 606 are discussed below.

Wealth Management Revenue

Wealth management revenue is primarily comprised of fees earned from the management and administration of trusts and other customer assets. The Company also earns investment advisory fees through its SEC registered investment advisory subsidiary. The Company’s performance obligation in both of these instances is generally satisfied over time and the resulting fees are recognized monthly, based upon the month-end market value of the assets under management and contractually determined fee schedules. Payment is generally received a few days after month end through a direct charge to each customer’s account. The Company does not earn performance-based incentives. Optional services such as real estate sales and tax return preparation services are also available to existing trust and asset management customers. The Company’s performance obligation for these transactional-based services is generally satisfied, and related revenue recognized, at a point in time (i.e., as incurred). Payment is received shortly after services are rendered. Fees generated from transactions executed by the Company’s third party broker dealer are remitted by them to the Company on a monthly basis for that month’s transactional activity.

Service Charges on Deposit Accounts

Service charges on deposit accounts consist of fees received under depository agreements with customers to provide access to deposited funds, serve as custodian of deposited funds, and when applicable, pay interest on deposits. These service charges primarily include non-sufficient fund fees and other account related service charges. Non-sufficient fund fees are earned when a depositor presents an item for payment in excess of available funds, and the Company, at its discretion, provides the necessary funds to complete the transaction. The Company generates other account related service charge revenue by providing depositors proper safeguard and remittance of funds as well as by delivering optional services for depositors, such as check imaging or treasury management, that are performed upon the depositor’s request. The Company’s performance obligation for the proper safeguard and remittance of funds, monthly account analysis and any other monthly service fees is generally satisfied, and the related revenue recognized, over the period in which the service is provided. Payment for service

charges on deposit accounts is typically received immediately or in the following month through a direct charge to a customer’s account.

Interchange Revenue

Interchange revenue includes debit / credit card income and ATM user fees. Card income is primarily comprised of interchange fees earned for standing ready to authorize and providing settlement on card transactions processed through the MasterCard interchange network. The levels and structure of interchange rates are set by MasterCard and can vary based on cardholder purchase volumes. Interchange fees from cardholder transactions represent a percentage of the underlying transaction value and are recognized daily, concurrently with completion of the Company’s performance obligation, the transaction processing services provided to the cardholder. Payment is typically received immediately or in the following month. ATM fees are primarily generated when a Company cardholder withdraws funds from a non-Company ATM or a non-Company cardholder withdraws funds from a Company ATM. The Company satisfies its performance obligation for each transaction at the point in time when the ATM withdrawal is processed.

Other Noninterest Income

The other noninterest income revenue streams within the scope of Topic 606 consist of merchant services revenue, safe deposit box rentals, wire transfer fees, paper statement fees, check printing commissions, gain on sales of other real estate owned, and other noninterest related fees. Revenue from the Company’s merchant services business consists principally of transaction and account management fees charged to merchants for the electronic processing of transactions. These fees are net of interchange fees paid to the credit card issuing bank, card company assessments, and revenue sharing amounts. Account management fees are considered earned at the time the merchant’s transactions are processed or other services are performed. Fees related to the other components of other noninterest income within the scope of Topic 606 are largely transactional based, and therefore, the Company’s performance obligation is satisfied and related revenue recognized, at the point in time the customer uses the selected service to execute a transaction.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI https://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
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-Section 50
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

+ Details

SUBSEQUENT EVENTS	9 Months Ended
SUBSEQUENT EVENTS	Sep. 30, 2022
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	SUBSEQUENT EVENTSOn October 24, 2022, the Company terminated the $140.0 million notional amount of future starting pay-fixed, receive-variable interest rate swaps on certain FHLB or other fixed-rate advances discussed in Note 9. The Company realized a $17.6 million net gain upon termination.

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of Presentation The consolidated financial statements of the Company are unaudited and should be read in conjunction with the consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the Securities and Exchange Commission (the “SEC”) on February 25, 2022. The consolidated financial statements have been prepared in accordance with the accounting principles generally accepted in the United States of America (“GAAP”) and conform to predominant practices within the banking industry. A discussion of these policies can be found in Note 1 – Summary of Significant Accounting Policies included in the Company's 2021 Annual Report on Form 10-K. Certain reclassifications of 2021 amounts have been made to conform to the 2022 presentation. Management has evaluated subsequent events for potential recognition or disclosure. Operating results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 or any other period.
Principles of Consolidation	Principles of Consolidation The consolidated financial statements include the accounts of the parent company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated. Assets held for customers in a fiduciary or agency capacity are not assets of the Company and, accordingly, other than trust cash on deposit with the Bank, are not included in the accompanying unaudited balance sheets.
Accounting Guidance Issued But Not Yet Adopted	Accounting Guidance Issued But Not Yet Adopted FASB ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting – In March 2020, the FASB issued ASU No. 2020-04 which provides optional expedients and exceptions for accounting related to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. ASU 2020-04 applies only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform; it does not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, for which an entity has elected certain optional expedients and that are retained through the end of the hedging relationship. ASU 2020-04 was effective upon issuance and generally can be applied through December 31, 2022. The Company has been monitoring its volume of commercial loans tied to LIBOR. In 2021, the Company began prioritizing SOFR as the preferred alternative reference rate with plans to cease booking LIBOR based commitments after the end of 2021. Loans with a maturity after June 2023 are being reviewed and monitored to ensure there is appropriate fallback language in place when LIBOR is no longer published. Loans with a maturity date before that time should naturally mature and be re-underwritten with the alternative index rate. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope, which addresses questions about whether Topic 848 can be applied to derivative instruments that do not reference a rate that is expected to be discontinued but that use an interest rate for margining, discounting, or contract price alignment that is expected to be modified as a result of reference rate reform, commonly referred to as the "discounting transition". The amendments clarify that certain optional expedients and exceptions in Topic 848 do apply to derivatives that are affected by the discounting transition. The amendments in ASU 2021-01 are effective immediately. The Company believes the adoption of this guidance on activities subsequent to December 31, 2021 through December 31, 2022 will not have a material impact on the consolidated financial statements. FASB ASU No. 2022-02, Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures – In March 2022, the FASB issued ASU No. 2022-02, which 1) eliminates the accounting guidance for troubled debt restructurings ("TDRs") by creditors while enhancing the disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty; and 2) requires that an entity disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases. ASU 2022-02 is effective for fiscal years beginning after December 15, 2022 and the amendments should be applied prospectively, although the entity has the option to apply a modified retrospective transition method for the recognition and measurement of TDRs, resulting in a cumulative-effect adjustment to retained earnings in the period of adoption. The Company is currently evaluating the impact of adopting the new guidance on its consolidated financial statements.

ACQUISITIONS (Tables)

9 Months Ended

Sep. 30, 2022

Business Combinations [Abstract]

Schedule of Business Acquisitions, by Acquisition

A summary of the fair value of the assets acquired and liabilities assumed are included in the table below.


(dollars in thousands)	FNBC
Assets acquired:
Cash and cash equivalents	$	60,275
Loans	16,632
Premises and equipment, net	950
Accrued interest receivable	36
Intangible assets	1,901
Total assets acquired	$	79,794
Liabilities assumed:
Deposits	$	79,794
Total liabilities assumed	$	79,794
Intangible assets:
Core deposit intangible	$	1,901
Estimated useful life	10 years

INVESTMENT SECURITIES (Tables)

9 Months Ended

Sep. 30, 2022

Investments, Debt and Equity Securities [Abstract]

Schedule of Investment Securities Classified as Available for Sale

Investment securities available for sale at September 30, 2022 and December 31, 2021 were as follows:


	September 30, 2022
(dollars in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Allowance for credit losses		Fair value
Investment securities available for sale
U.S. Treasury securities	$	66,369	$	—	$	5,873	$	—	$	60,496
U.S. government sponsored entities and U.S. agency securities	32,267		78		4,480		—		27,865
Mortgage-backed securities - agency	469,822		5		78,212		—		391,615
Mortgage-backed securities - non-agency	25,341		—		4,183		—		21,158
State and municipal securities	105,838		128		10,905		—		95,061
Corporate securities	95,313		—		9,619		—		85,694
Total available for sale securities	$	794,950	$	211	$	113,272	$	—	$	681,889


	December 31, 2021
(dollars in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Allowance for credit losses		Fair value
Investment securities available for sale
U.S. Treasury securities	$	65,347	$	—	$	430	$	—	$	64,917
U.S. government sponsored entities and U.S. agency securities	34,569		79		831		—		33,817
Mortgage-backed securities - agency	444,484		2,687		6,901		—		440,270
Mortgage-backed securities - non-agency	29,037		50		381		—		28,706
State and municipal securities	137,904		5,561		366		—		143,099
Corporate securities	193,354		3,128		467		221		195,794
Total available for sale securities	$	904,695	$	11,505	$	9,376	$	221	$	906,603

Debt Securities, Available-for-sale


(dollars in thousands)	Amortized cost		Fair value
Investment securities available for sale
Within one year	$	9,766	$	9,793
After one year through five years	123,074		113,574
After five years through ten years	135,520		119,588
After ten years	31,427		26,161
Mortgage-backed securities	495,163		412,773
Total available for sale securities	$	794,950	$	681,889

Proceeds and gross realized gains on sales of investment securities available for sale for the three and nine months ended September 30, 2022 and 2021, are summarized as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Investment securities available for sale
Proceeds from sales	$	28,663	$	2,160	$	136,403	$	14,777
Gross realized gains on sales	113		160		829		537
Gross realized losses on sales	(242)		—		(1,059)		—

Allowance for Credit Loss Rollforward


(dollars in thousands)	Mortgage-backed securities - non-agency		State and municipal securities		Corporate securities		Total
Changes in allowance for credit losses on investment securities available for sale:
For the three months ended September 30, 2022
Balance, beginning of period	$	—	$	—	$	—	$	—
Current-period provision for expected credit losses	—		—		—		—
Balance, end of period	$	—	$	—	$	—	$	—
For the nine months ended September 30, 2022
Balance, beginning of period	$	—	$	—	$	221	$	221
Current-period provision for expected credit losses	—		—		(221)		(221)
Balance, end of period	$	—	$	—	$	—	$	—
For the three months ended September 30, 2021
Balance, beginning of period	$	113	$	—	$	213	$	326
Current-period provision for expected credit losses	(113)		—		(71)		(184)
Balance, end of period	$	—	$	—	$	142	$	142
For the nine months ended September 30, 2021
Balance, beginning of period	$	—	$	29	$	337	$	366
Current-period provision for expected credit losses	—		(29)		(195)		(224)
Balance, end of period	$	—	$	—	$	142	$	142

Schedule of Unrealized Losses and Fair Values for Investment Securities


	September 30, 2022
	Less than 12 Months				12 Months or more				Total
(dollars in thousands)	Fair value		Unrealized loss		Fair value		Unrealized loss		Fair value		Unrealized loss
Investment securities available for sale
U.S. Treasury securities	$	37,689	$	3,305	$	22,807	$	2,568	$	60,496	$	5,873
U.S. government sponsored entities and U.S. agency securities	333		19		23,289		4,461		23,622		4,480
Mortgage-backed securities - agency	168,562		21,838		222,652		56,374		391,214		78,212
Mortgage-backed securities - non-agency	6,228		879		14,930		3,304		21,158		4,183
State and municipal securities	56,578		5,879		22,193		5,026		78,771		10,905
Corporate securities	57,401		4,767		28,293		4,852		85,694		9,619
Total available for sale securities	$	326,791	$	36,687	$	334,164	$	76,585	$	660,955	$	113,272


	December 31, 2021
	Less than 12 Months				12 Months or more				Total
(dollars in thousands)	Fair value		Unrealized loss		Fair value		Unrealized loss		Fair value		Unrealized loss
Investment securities available for sale
U.S. Treasury securities	$	64,917	$	430	$	—	$	—	$	64,917	$	430
U.S. government sponsored entities and U.S. agency securities	17,487		263		9,432		568		26,919		831
Mortgage-backed securities - agency	317,372		6,633		9,051		268		326,423		6,901
Mortgage-backed securities - non-agency	24,095		381		—		—		24,095		381
State and municipal securities	27,324		270		2,538		96		29,862		366
Corporate securities	—		—		—		—		—		—
Total available for sale securities	$	451,195	$	7,977	$	21,021	$	932	$	472,216	$	8,909

Schedule of Unrealized Gain (Loss)

Net unrealized gains and losses on equity securities for the three and nine months ended September 30, 2022 and 2021 are summarized below:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Equity securities



Net unrealized (losses) gains	$	(118)	$	112	$	(1,065)	$	338

LOANS (Tables)

9 Months Ended

Sep. 30, 2022

Receivables [Abstract]

Summary of Loans

The following table presents total loans outstanding by portfolio class, as of September 30, 2022 and December 31, 2021:


(dollars in thousands)	September 30, 2022		December 31, 2021
Commercial:
Commercial	$	852,930	$	770,670
Commercial other	683,353		679,518
Commercial real estate:
Commercial real estate non-owner occupied	1,567,308		1,105,333
Commercial real estate owner occupied	505,174		469,658
Multi-family	328,473		171,875
Farmland	65,348		69,962
Construction and land development	225,549		193,749
Total commercial loans	4,228,135		3,460,765
Residential real estate:
Residential first lien	294,432		274,412
Other residential	61,793		63,739
Consumer:
Consumer	110,226		106,008
Consumer other	1,046,254		896,597
Lease financing	457,611		423,280
Total loans, gross	$	6,198,451	$	5,224,801

Schedule Of Changes In Financing Receivable Related Parties Roll Forward

The new loans, other additions, repayments and other reductions for the three and nine months ended September 30, 2022 and 2021, are summarized as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Beginning balance	$	23,097	$	18,762	$	13,869	$	19,693
New loans and other additions	—		21		9,804		1,045
Repayments and other reductions	(3,081)		(3,424)		(3,657)		(5,379)
Ending balance	$	20,016	$	15,359	$	20,016	$	15,359

Summary of Changes in Allowance for Loan Losses, by Loan Portfolio

The following table represents, by loan portfolio segment, a summary of changes in the allowance for credit losses on loans for the three and nine months ended September 30, 2022 and 2021:


	Commercial Loan Portfolio						Other Loan Portfolio
(dollars in thousands)	Commercial		Commercial real estate		Construction and land development		Residential real estate		Consumer		Lease financing		Total
Changes in allowance for credit losses on loans for the three months ended September 30, 2022:
Balance, beginning of period	$	12,748	$	27,874	$	1,101	$	3,416	$	2,994	$	6,765	$	54,898
Provision for credit losses on loans	3,226		1,787		472		852		606		31		6,974
Charge-offs	(1,655)		(1,232)		—		(166)		(316)		(485)		(3,854)
Recoveries	45		1		18		69		121		367		621
Balance, end of period	$	14,364	$	28,430	$	1,591	$	4,171	$	3,405	$	6,678	$	58,639

Changes in allowance for credit losses on loans for the nine months ended September 30, 2022:
Balance, beginning of period	$	14,375	$	22,993	$	972	$	2,695	$	2,558	$	7,469	$	51,062
Provision for credit losses on loans	3,504		9,515		595		1,569		1,278		(614)		15,847
Charge-offs	(3,869)		(4,084)		(6)		(315)		(812)		(1,190)		(10,276)
Recoveries	354		6		30		222		381		1,013		2,006
Balance, end of period	$	14,364	$	28,430	$	1,591	$	4,171	$	3,405	$	6,678	$	58,639

Changes in allowance for credit losses on loans for the three months ended September 30, 2021:
Balance, beginning of period	$	14,849	$	30,718	$	1,733	$	3,683	$	2,292	$	5,389	$	58,664
Provision for credit losses on loans	(75)		(2,105)		(538)		(697)		292		3,123		—
Charge-offs	(317)		(1,663)		(138)		(35)		(280)		(1,227)		(3,660)
Recoveries	134		3		74		66		93		301		671
Balance, end of period	$	14,591	$	26,953	$	1,131	$	3,017	$	2,397	$	7,586	$	55,675

Changes in allowance for credit losses on loans for the nine months ended September 30, 2021:
Balance, beginning of period	$	19,851	$	25,465	$	1,433	$	3,929	$	2,338	$	7,427	$	60,443


Provision for credit losses on loans	(2,091)		4,854		(113)		(806)		429		1,677		3,950
Charge-offs	(3,457)		(3,382)		(410)		(286)		(740)		(1,996)		(10,271)
Recoveries	288		16		221		180		370		478		1,553
Balance, end of period	$	14,591	$	26,953	$	1,131	$	3,017	$	2,397	$	7,586	$	55,675

Schedule of Transitioning Risk States for Each Asset Pool within the Expected Credit Loss Model

The below table illustrates the transition matrix:


Risk state	Commercial loans risk rating	Consumer loans and equipment finance loans and leases days past due
1	0-5	0-14
2	6	15-29
3	7	30-59
4	8	60-89
Default	9+ and nonaccrual	90+ and nonaccrual

Schedule of Amortized Cost Basis of Individually Evaluated Loans on Nonaccrual Status

The following table presents amortized cost basis of individually evaluated loans on nonaccrual status as of September 30, 2022 and December 31, 2021:


	September 30, 2022						December 31, 2021
(dollars in thousands)	Nonaccrual with allowance		Nonaccrual with no allowance		Total nonaccrual		Nonaccrual with allowance		Nonaccrual with no allowance		Total nonaccrual
Commercial:
Commercial	$	4,179	$	508	$	4,687	$	4,681	$	2,275	$	6,956
Commercial other	2,104		—		2,104		4,467		—		4,467
Commercial real estate:
Commercial real estate non-owner occupied	1,590		12,118		13,708		1,914		9,912		11,826
Commercial real estate owner occupied	2,882		1,340		4,222		2,164		1,340		3,504
Multi-family	164		9,003		9,167		201		1,967		2,168
Farmland	25		—		25		155		—		155
Construction and land development	245		—		245		83		—		83
Total commercial loans	11,189		22,969		34,158		13,665		15,494		29,159
Residential real estate:
Residential first lien	2,884		633		3,517		3,116		832		3,948
Other residential	798		—		798		836		—		836
Consumer:
Consumer	72		—		72		110		—		110

Lease financing	1,506		—		1,506		1,510		—		1,510
Total loans	$	16,449	$	23,602	$	40,051	$	19,237	$	16,326	$	35,563

Schedule of Collateral Dependent Loans


	Type of Collateral
(dollars in thousands)	Real Estate		Blanket Lien		Equipment		Total
September 30, 2022
Commercial:
Commercial	$	—	$	3,244	$	—	$	3,244
Commercial other	—		—		278		278
Commercial real estate:
Non-owner occupied	12,655		—		—		12,655
Owner occupied	1,336		—		—		1,336
Multi-family	1,873		—		—		1,873



Lease financing	—		—		110		110
Total collateral dependent loans	$	15,864	$	3,244	$	388	$	19,496

December 31, 2021
Commercial:
Commercial	$	—	$	5,402	$	—	$	5,402
Commercial other	—		—		502		502
Commercial real estate:
Non-owner occupied	11,604		—		—		11,604
Owner occupied	1,336		—		—		1,336
Multi-family	1,969		—		—		1,969




Total collateral dependent loans	$	14,909	$	5,402	$	502	$	20,813

Summary of Aging Status of Recorded Investments in Loans by Portfolio (Excluding PCI Loans)

The aging status of the recorded investment in loans by portfolio as of September 30, 2022 was as follows:


	Accruing loans
(dollars in thousands)	30-59 days past due		60-89 days past due		Past due 90 days or more		Total past due		Nonaccrual		Current		Total
Commercial:
Commercial	$	7,609	$	518	$	—	$	8,127	$	4,687	$	840,116	$	852,930
Commercial other	3,510		2,189		281		5,980		2,104		675,269		683,353
Commercial real estate:
Commercial real estate non-owner occupied	771		265		—		1,036		13,708		1,552,564		1,567,308
Commercial real estate owner occupied	481		—		—		481		4,222		500,471		505,174
Multi-family	—		—		—		—		9,167		319,306		328,473
Farmland	88		—		—		88		25		65,235		65,348
Construction and land development	—		—		—		—		245		225,304		225,549
Total commercial loans	12,459		2,972		281		15,712		34,158		4,178,265		4,228,135
Residential real estate:
Residential first lien	30		209		77		316		3,517		290,599		294,432
Other residential	197		50		—		247		798		60,748		61,793
Consumer:
Consumer	109		50		—		159		72		109,995		110,226
Consumer other	5,020		3,159		142		8,321		—		1,037,933		1,046,254
Lease financing	3,033		987		193		4,213		1,506		451,892		457,611
Total loans	$	20,848	$	7,427	$	693	$	28,968	$	40,051	$	6,129,432	$	6,198,451

The aging status of the recorded investment in loans by portfolio as of December 31, 2021 was as follows:


	Accruing loans
(dollars in thousands)	30-59 days past due		60-89 days past due		Past due 90 days or more		Total past due		Nonaccrual		Current		Total
Commercial:
Commercial	$	283	$	1,082	$	—	$	1,365	$	6,956	$	762,349	$	770,670
Commercial other	2,402		2,110		5		4,517		4,467		670,534		679,518
Commercial real estate:
Commercial real estate non-owner occupied	585		243		—		828		11,826		1,092,679		1,105,333
Commercial real estate owner occupied	232		730		—		962		3,504		465,192		469,658
Multi-family	—		—		—		—		2,168		169,707		171,875
Farmland	—		26		—		26		155		69,781		69,962
Construction and land development	195		195		—		390		83		193,276		193,749
Total commercial loans	3,697		4,386		5		8,088		29,159		3,423,518		3,460,765
Residential real estate:
Residential first lien	113		285		—		398		3,948		270,066		274,412
Other residential	456		151		—		607		836		62,296		63,739
Consumer:
Consumer	127		20		—		147		110		105,751		106,008
Consumer other	4,423		2,358		1		6,782		—		889,815		896,597
Lease financing	1,253		245		—		1,498		1,510		420,272		423,280
Total loans	$	10,069	$	7,445	$	6	$	17,520	$	35,563	$	5,171,718	$	5,224,801

Summary of TDRs Loans


	September 30, 2022						December 31, 2021
(dollars in thousands)	Accruing (1)		Non-accrual (2)		Total		Accruing (1)		Non-accrual (2)		Total
Commercial	$	1,727	$	511	$	2,238	$	833	$	1,422	$	2,255
Commercial real estate	113		2,627		2,740		1,522		3,302		4,824
Construction and land development	29		—		29		37		—		37
Residential real estate	3,384		702		4,086		3,128		784		3,912
Consumer	59		—		59		98		—		98
Lease financing	824		21		845		1,394		241		1,635
Total loans	$	6,136	$	3,861	$	9,997	$	7,012	$	5,749	$	12,761

(1)These loans are still accruing interest.

(2)These loans are included in non-accrual loans in the preceding tables.


	Commercial loan portfolio						Other loan portfolio
(dollars in thousands)	Commercial		Commercial real estate		Construction and land development		Residential real estate		Consumer		Lease financing		Total
For the three months ended September 30, 2022
Troubled debt restructurings:
Number of loans	—		—		—		2		—		—		2
Pre-modification outstanding balance	$	—	$	—	$	—	$	56	$	—	$	—	$	56
Post-modification outstanding balance	—		—		—		56		—		—		56





For the nine months ended September 30, 2022
Troubled debt restructurings:
Number of loans	4		1		—		7		3		2		17
Pre-modification outstanding balance	$	1,324	$	6	$	—	$	260	$	107	$	84	$	1,781
Post-modification outstanding balance	1,324		6		—		260		105		84		1,779





For the three months ended September 30, 2021
Troubled debt restructurings:
Number of loans	2		1		—		—		—		3		6
Pre-modification outstanding balance	$	114	$	152	$	—	$	—	$	—	$	234	$	500
Post-modification outstanding balance	114		130		—		—		—		234		478





For the nine months ended September 30, 2021
Troubled debt restructurings:
Number of loans	7		2		1		3		3		4		20
Pre-modification outstanding balance	$	723	$	1,584	$	49	$	191	$	50	$	739	$	3,336
Post-modification outstanding balance	723		1,562		40		195		50		739		3,309

Schedule of Loans Credit Equality Indicators

The following tables present the recorded investment of the commercial loan portfolio by risk category as of September 30, 2022 and December 31, 2021:


			September 30, 2022
			Term Loans Amortized Cost Basis by Origination Year
(dollars in thousands)			2022		2021		2020		2019		2018		Prior		Revolving loans		Total
Commercial	Commercial	Acceptable credit quality	$	83,501	$	107,645	$	72,269	$	29,183	$	13,578	$	50,113	$	482,069	$	838,358
		Special mention	—		48		—		314		926		267		1,928		3,483
		Substandard	—		—		—		—		1,385		4,142		875		6,402
		Substandard – nonaccrual	—		340		—		99		112		259		3,877		4,687
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	83,501		108,033		72,269		29,596		16,001		54,781		488,749		852,930

	Commercial other	Acceptable credit quality	207,903		168,275		116,826		73,659		18,985		311		90,558		676,517
		Special mention	—		—		797		2,285		485		—		55		3,622
		Substandard	250		—		—		12		—		—		848		1,110
		Substandard – nonaccrual	343		770		24		473		494		—		—		2,104
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	208,496		169,045		117,647		76,429		19,964		311		91,461		683,353

Commercial real estate	Non-owner occupied	Acceptable credit quality	580,648		437,901		141,562		93,945		18,964		177,967		3,807		1,454,794
		Special mention	1,423		187		482		10,670		198		9,396		—		22,356
		Substandard	593		106		—		36,858		1,611		37,282		—		76,450
		Substandard – nonaccrual	—		744		—		49		10,246		2,669		—		13,708
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	582,664		438,938		142,044		141,522		31,019		227,314		3,807		1,567,308

	Owner occupied	Acceptable credit quality	105,981		131,950		66,624		40,949		29,247		108,957		4,667		488,375
		Special mention	—		135		—		168		159		1,680		24		2,166
		Substandard	45		4,186		575		2,026		—		3,579		—		10,411
		Substandard – nonaccrual	—		385		309		156		333		2,735		304		4,222
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	106,026		136,656		67,508		43,299		29,739		116,951		4,995		505,174

	Multi-family	Acceptable credit quality	188,990		51,461		33,440		445		24,604		15,768		1,020		315,728
		Special mention	—		—		—		—		—		—		—		—
		Substandard	—		—		—		—		—		3,578		—		3,578
		Substandard – nonaccrual	—		949		—		114		—		8,104		—		9,167
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	188,990		52,410		33,440		559		24,604		27,450		1,020		328,473

	Farmland	Acceptable credit quality	5,303		16,267		14,099		4,228		3,250		20,222		1,227		64,596
		Special mention	—		—		—		—		—		161		—		161
		Substandard	—		15		—		23		13		348		167		566
		Substandard – nonaccrual	—		—		—		—		—		25		—		25
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	5,303		16,282		14,099		4,251		3,263		20,756		1,394		65,348

Construction and land development		Acceptable credit quality	81,438		67,959		31,357		8,051		489		1,446		29,913		220,653
		Special mention	—		—		—		—		2,415		210		—		2,625
		Substandard	—		—		—		—		—		—		—		—
		Substandard – nonaccrual	—		—		—		218		—		27		—		245
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	1,649		339		34		—		—		4		—		2,026
		Subtotal	83,087		68,298		31,391		8,269		2,904		1,687		29,913		225,549

Total		Acceptable credit quality	1,253,764		981,458		476,177		250,460		109,117		374,784		613,261		4,059,021
		Special mention	1,423		370		1,279		13,437		4,183		11,714		2,007		34,413
		Substandard	888		4,307		575		38,919		3,009		48,929		1,890		98,517
		Substandard – nonaccrual	343		3,188		333		1,109		11,185		13,819		4,181		34,158
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	1,649		339		34		—		—		4		—		2,026
Total commercial loans			$	1,258,067	$	989,662	$	478,398	$	303,925	$	127,494	$	449,250	$	621,339	$	4,228,135


			December 31, 2021
			Term Loans Amortized Cost Basis by Origination Year
(dollars in thousands)			2021		2020		2019		2018		2017		Prior		Revolving loans		Total
Commercial	Commercial	Acceptable credit quality	$	108,490	$	78,071	$	50,458	$	20,045	$	27,405	$	35,856	$	417,920	$	738,245
		Special mention	186		57		198		6,154		2		316		1,517		8,430
		Substandard	380		372		1,934		1,868		64		4,322		8,099		17,039
		Substandard – nonaccrual	52		—		612		177		242		169		5,704		6,956
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	109,108		78,500		53,202		28,244		27,713		40,663		433,240		770,670

	Commercial other	Acceptable credit quality	264,282		167,326		101,083		29,981		303		341		88,198		651,514
		Special mention	—		1,929		10,676		3,966		—		—		3,252		19,823
		Substandard	688		—		62		341		—		—		2,623		3,714
		Substandard – nonaccrual	10		158		3,894		384		—		—		21		4,467
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	264,980		169,413		115,715		34,672		303		341		94,094		679,518

Commercial real estate	Non-owner occupied	Acceptable credit quality	441,483		154,379		134,507		20,524		55,207		182,465		5,258		993,823
		Special mention	26		6,341		14,177		2,296		711		2,272		—		25,823
		Substandard	6,196		817		8,825		20,572		14,857		22,344		250		73,861
		Substandard – nonaccrual	169		992		6,206		—		195		4,264		—		11,826
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	447,874		162,529		163,715		43,392		70,970		211,345		5,508		1,105,333

	Owner occupied	Acceptable credit quality	141,084		69,415		47,187		35,974		30,583		98,442		1,886		424,571
		Special mention	150		24		187		161		13,087		4,540		32		18,181
		Substandard	4,192		1,127		10,810		205		297		6,466		305		23,402
		Substandard – nonaccrual	—		318		129		336		72		2,649		—		3,504
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	145,426		70,884		58,313		36,676		44,039		112,097		2,223		469,658

	Multi-family	Acceptable credit quality	88,329		20,080		1,973		25,450		1,414		18,642		2,241		158,129
		Special mention	—		451		—		—		—		—		—		451
		Substandard	988		—		—		—		—		10,139		—		11,127
		Substandard – nonaccrual	—		—		123		—		—		2,045		—		2,168
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	89,317		20,531		2,096		25,450		1,414		30,826		2,241		171,875

	Farmland	Acceptable credit quality	15,689		14,966		3,931		3,162		7,996		19,305		1,196		66,245
		Special mention	—		66		1,236		145		153		240		—		1,840
		Substandard	371		76		166		211		—		898		—		1,722
		Substandard – nonaccrual	—		—		—		105		—		—		50		155
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	—		—		—		—		—		—		—		—
		Subtotal	16,060		15,108		5,333		3,623		8,149		20,443		1,246		69,962

Construction and land development		Acceptable credit quality	65,053		65,274		19,269		10,029		2,511		3,841		19,452		185,429
		Special mention	—		—		5,014		—		—		221		—		5,235
		Substandard	—		1,336		—		—		—		—		—		1,336
		Substandard – nonaccrual	—		—		43		—		—		40		—		83
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	1,465		37		—		—		—		164		—		1,666
		Subtotal	66,518		66,647		24,326		10,029		2,511		4,266		19,452		193,749

Total		Acceptable credit quality	1,124,410		569,511		358,408		145,165		125,419		358,892		536,151		3,217,956
		Special mention	362		8,868		31,488		12,722		13,953		7,589		4,801		79,783
		Substandard	12,815		3,728		21,797		23,197		15,218		44,169		11,277		132,201
		Substandard – nonaccrual	231		1,468		11,007		1,002		509		9,167		5,775		29,159
		Doubtful	—		—		—		—		—		—		—		—
		Not graded	1,465		37		—		—		—		164		—		1,666
Total commercial loans			$	1,139,283	$	583,612	$	422,700	$	182,086	$	155,099	$	419,981	$	558,004	$	3,460,765

The following tables present the recorded investment of our other loan portfolio based on the credit risk profile of loans that are performing and loans that are nonperforming as of September 30, 2022 and December 31, 2021:


			September 30, 2022
			Term Loans Amortized Cost Basis by Origination Year
(dollars in thousands)			2022		2021		2020		2019		2018		Prior		Revolving Loans		Total
Residential real estate	Residential first lien	Performing	$	57,217	$	39,570	$	31,875	$	21,340	$	22,376	$	115,686	$	298	$	288,362
		Nonperforming	102		—		105		195		870		4,798		—		6,070
		Subtotal	57,319		39,570		31,980		21,535		23,246		120,484		298		294,432

	Other residential	Performing	1,381		517		556		1,147		1,568		1,772		53,146		60,087
		Nonperforming	—		—		—		8		10		214		1,474		1,706
		Subtotal	1,381		517		556		1,155		1,578		1,986		54,620		61,793

Consumer	Consumer	Performing	30,643		42,722		10,102		4,397		3,676		16,128		2,426		110,094
		Nonperforming	22		36		8		1		14		50		1		132
		Subtotal	30,665		42,758		10,110		4,398		3,690		16,178		2,427		110,226

	Consumer other	Performing	568,209		300,430		117,490		39,291		7,488		6,188		7,017		1,046,113
		Nonperforming	141		—		—		—		—		—		—		141
		Subtotal	568,350		300,430		117,490		39,291		7,488		6,188		7,017		1,046,254

Leases financing		Performing	149,392		118,613		94,940		63,175		20,649		8,319		—		455,088
		Nonperforming	—		646		883		676		300		18		—		2,523
		Subtotal	149,392		119,259		95,823		63,851		20,949		8,337		—		457,611

Total		Performing	806,842		501,852		254,963		129,350		55,757		148,093		62,887		1,959,744
		Nonperforming	265		682		996		880		1,194		5,080		1,475		10,572
Total other loans			$	807,107	$	502,534	$	255,959	$	130,230	$	56,951	$	153,173	$	64,362	$	1,970,316


			December 31, 2021
			Term Loans Amortized Cost Basis by Origination Year
(dollars in thousands)			2021		2020		2019		2018		2017		Prior		Revolving loans		Total
Residential real estate	Residential first lien	Performing	$	38,508	$	31,920	$	24,311	$	30,842	$	48,276	$	93,462	$	888	$	268,207
		Nonperforming	—		108		173		780		764		4,380		—		6,205
		Subtotal	38,508		32,028		24,484		31,622		49,040		97,842		888		274,412

	Other residential	Performing	888		679		1,520		1,950		1,211		1,559		54,225		62,032
		Nonperforming	—		—		10		16		128		100		1,453		1,707
		Subtotal	888		679		1,530		1,966		1,339		1,659		55,678		63,739

Consumer	Consumer	Performing	65,915		14,955		7,874		8,728		3,025		2,582		2,721		105,800
		Nonperforming	89		5		3		14		24		71		2		208
		Subtotal	66,004		14,960		7,877		8,742		3,049		2,653		2,723		106,008

	Consumer other	Performing	474,385		323,437		63,463		12,635		3,888		5,447		13,341		896,596
		Nonperforming	—		—		—		—		—		—		1		1
		Subtotal	474,385		323,437		63,463		12,635		3,888		5,447		13,342		896,597

Leases financing		Performing	154,803		124,575		86,402		43,536		9,077		1,983		—		420,376
		Nonperforming	—		757		1,001		1,012		95		39		—		2,904
		Subtotal	154,803		125,332		87,403		44,548		9,172		2,022		—		423,280

Total
		Performing	734,499		495,566		183,570		97,691		65,477		105,033		71,175		1,753,011
		Nonperforming	89		870		1,187		1,822		1,011		4,590		1,456		11,025
Total other loans			$	734,588	$	496,436	$	184,757	$	99,513	$	66,488	$	109,623	$	72,631	$	1,764,036

PREMISES, EQUIPMENT AND LEASES (Tables)

9 Months Ended

Sep. 30, 2022

Property, Plant and Equipment [Abstract]

Summary of Premises and Equipment

A summary of premises and equipment at September 30, 2022 and December 31, 2021 is as follows:


(dollars in thousands)	September 30, 2022		December 31, 2021
Land	$	15,803	$	15,696
Buildings and improvements	69,573		67,143
Furniture and equipment	33,946		33,545
Lease right-of-use assets	7,582		8,428
Total	126,904		124,812
Accumulated depreciation	(49,385)		(45,592)
Premises and equipment, net	$	77,519	$	79,220

Summary of Information Related to Operating Leases

Information related to operating leases for the three and nine months ended September 30, 2022 and 2021 was as follows:


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in thousands)	2022			2021			2022			2021
Operating lease cost	$	533		$	510		$	1,576		$	1,547
Operating cash flows from leases	638			589			1,874			1,975
Right-of-use assets obtained in exchange for lease obligations	80			—			502			689
Right-of-use assets derecognized due to terminations or impairment	—			—			—			(210)
Weighted average remaining lease term	7.3 years			7.8 years			7.3 years			7.8 years
Weighted average discount rate	2.88		%	2.88		%	2.88		%	2.88		%

Summary of Projected Minimum Rental Payments

The projected minimum rental payments under the terms of the leases as of September 30, 2022 were as follows:


(dollars in thousands)	Amount
Year ending December 31:
2022 remaining	$	419
2023	2,185
2024	1,879
2025	975
2026	843
Thereafter	4,296
Total future minimum lease payments	10,597
Less imputed interest	(1,084)
Total operating lease liabilities	$	9,513

LOAN SERVICING RIGHTS (Tables)

9 Months Ended

Sep. 30, 2022

Transfers and Servicing [Abstract]

Schedule of Other Mortgage Notes Serviced and Changes in our Mortgage Servicing Rights

A summary of loan servicing rights at September 30, 2022 and December 31, 2021 is as follows:


	September 30, 2022				December 31, 2021
	Serviced Loans		Carrying Value		Serviced Loans		Carrying Value
Commercial FHA	$	—	$	—	$	2,650,531	$	27,386
SBA	46,799		715		50,043		774
Residential	264,318		582		302,618		705
Commercial FHA held for sale	2,362,462		23,995		—		—
Total	$	2,673,579	$	25,292	$	3,003,192	$	28,865

Changes in our commercial FHA loan servicing rights for the three and nine months ended September 30, 2022 and 2021 are summarized as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Loan servicing rights:
Balance, beginning of period	$	24,603	$	33,732	$	27,386	$	38,322

Servicing rights transferred to held for sale	(23,995)		—		(23,995)		—
Amortization	(608)		(721)		(1,907)		(2,284)
Refinancing fee received from third party	—		165		(221)		(439)
Permanent impairment	—		(3,037)		(1,263)		(5,460)
Balance, end of period	$	—	$	30,139	$	—	$	30,139






Fair value:
At beginning of period	$	26,865	$	34,255	$	28,368	$	38,322
At end of period	—		31,012		—		31,012

GOODWILL AND INTANGIBLE ASSETS (Tables)

9 Months Ended

Sep. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets

The carrying amount of goodwill by segment at September 30, 2022 and December 31, 2021 is summarized as follows:


(dollars in thousands)	September 30, 2022		December 31, 2021
Banking	$	157,158	$	157,158

Wealth management	4,746		4,746
Total goodwill	$	161,904	$	161,904

The Company’s intangible assets, consisting of core deposit and customer relationship intangibles, as of September 30, 2022 and December 31, 2021 are summarized as follows:


	September 30, 2022						December 31, 2021
(dollars in thousands)	Gross carrying amount		Accumulated amortization		Total		Gross carrying amount		Accumulated amortization		Total
Core deposit intangibles	$	58,913	$	(43,708)	$	15,205	$	57,012	$	(40,603)	$	16,409
Customer relationship intangibles	15,919		(8,926)		6,993		15,918		(7,953)		7,965
Total intangible assets	$	74,832	$	(52,634)	$	22,198	$	72,930	$	(48,556)	$	24,374

DERIVATIVE INSTRUMENTS (Tables)

9 Months Ended

Sep. 30, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments, Fair Value and Notional Amounts


	Notional amount				Fair value gain
(dollars in thousands)	September 30, 2022		December 31, 2021		September 30, 2022		December 31, 2021
Derivative instruments (included in other assets):
Interest rate lock commitments	$	4,419	$	66,216	$	(15)	$	410
Forward commitments to sell mortgage-backed securities	11,054		60,427		165		—
Total	$	15,473	$	126,643	$	150	$	410


	Notional amount				Fair value loss
(dollars in thousands)	September 30, 2022		December 31, 2021		September 30, 2022		December 31, 2021
Derivative instruments (included in other liabilities):
Interest rate lock commitments	$	9,138	$	—	$	317	$	—
Forward commitments to sell mortgage-backed securities	—		18,362		—		19
Total	$	9,138	$	18,362	$	317	$	19

The following table summarizes the Company's receive-fixed, pay-variable interest rate swaps on certain pools of loans indexed to prime at September 30, 2022:


(dollars in thousands)	September 30, 2022
Notional Amount	$	200,000
Fair value loss included in other liabilities	(10,734)
Tax effected amount included in accumulated other comprehensive (loss) income	(7,836)
Average remaining life	3.6 years
Weighted average pay rate	6.25		%
Weighted average receive rate	5.48		%


(dollars in thousands)	September 30, 2022		December 31, 2021
Notional Amount	$	140,000	$	140,000
Fair value gain included in other assets	16,422		5,095
Tax effected amount included in accumulated other comprehensive (loss) income	11,988		3,694

DEPOSITS (Tables)

9 Months Ended

Sep. 30, 2022

Deposits [Abstract]

Schedule Summarizes the Classification of Deposits

The following table summarizes the classification of deposits as of September 30, 2022 and December 31, 2021:


(dollars in thousands)	September 30, 2022		December 31, 2021
Noninterest-bearing demand	$	2,025,237	$	2,245,701
Interest-bearing:
Checking	1,905,439		1,663,021
Money market	1,125,333		869,067
Savings	704,245		679,115
Time	634,998		653,744
Total deposits	$	6,395,252	$	6,110,648

- Definition

Tabular disclosure of type of deposit liability.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (e)

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (2)(i)(ii)

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)
-Subparagraph (1)

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (1)

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (d)

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (2)(i)

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (2)(i)(iv)

Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)
-Subparagraph (5)

Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (2)(i)(iii)

Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)
-Subparagraph (4)

Reference 11: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (f)
-Subparagraph (2)

Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (c)

Reference 13: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)
-Subparagraph (2)

Reference 14: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)
-Subparagraph (3)

Reference 15: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher SEC
-Name Regulation S-K (SK)
-Number 229
-Section 1406
-Paragraph (a)

+ Details

SHORT-TERM BORROWINGS (Tables)

9 Months Ended

Sep. 30, 2022

Debt Disclosure [Abstract]

Schedule of Short Term Borrowings

The following table presents the distribution of short-term borrowings and related weighted average interest rates as of September 30, 2022 and December 31, 2021:


	Repurchase agreements
(dollars in thousands)	As of and for the Nine Months Ended September 30, 2022			As of and for the Year Ended December 31, 2021
Outstanding at period-end	$	58,518		$	76,803
Average amount outstanding	62,495			68,986
Maximum amount outstanding at any month end	76,807			77,497
Weighted average interest rate:
During period	0.16		%	0.12		%
End of period	0.26		%	0.13		%

FHLB ADVANCES AND OTHER BORROWINGS (Tables)

9 Months Ended

Sep. 30, 2022

FHLB ADVANCES AND OTHER BORROWINGS

Schedule of Federal Home Loan Bank (FHLB) Advances

The following table summarizes our FHLB advances and other borrowings as of September 30, 2022 and December 31, 2021:


(dollars in thousands)	September 30, 2022		December 31, 2021
Midland States Bancorp, Inc.
Revolving line of credit - variable interest rate equivalent to Daily Simple SOFR plus 1.60%	$	—	$	—
Series G redeemable preferred stock - 171 shares at $1,000 per share	—		171
Midland States Bank
FHLB advances – putable fixed rate at rates averaging 2.35% and 1.48% at September 30, 2022 and December 31, 2021, respectively – maturing through December 2024	110,000		210,000
FHLB advances –SOFR floater at rates averaging 4.60% and 1.67% at September 30, 2022 and December 31, 2021, respectively – maturing in October 2023	100,000		100,000
FHLB advances – Short term fixed rate at rates averaging 3.14% at September 30, 2022 – maturing in October 2022	150,000		—
Total FHLB advances and other borrowings	$	360,000	$	310,171

SUBORDINATED DEBT (Tables)

9 Months Ended

Sep. 30, 2022

Subordinated Borrowings [Abstract]

Schedule of Summary of Company's Subordinated Debt

The following table summarizes the Company’s subordinated debt as of September 30, 2022 and December 31, 2021:


(dollars in thousands)	September 30, 2022		December 31, 2021
Subordinated debt issued June 2015 – fixed interest rate of 6.50%, $550 - maturing June 18, 2025	$	547	$	546
Subordinated debt issued October 2017 – fixed interest rate of 6.25% through October 2022 and a variable interest rate equivalent to three month LIBOR plus 4.23% thereafter, $40,000 - maturing October 15, 2027	39,674		39,626
Subordinated debt issued September 2019 – fixed interest rate of 5.00% through September 2024 and a variable interest rate equivalent to three month SOFR plus 3.61% thereafter, $72,750 - maturing September 30, 2029	72,236		72,042
Subordinated debt issued September 2019 – fixed interest rate of 5.50% through September 2029 and a variable interest rate equivalent to three month SOFR plus 4.05% thereafter, $27,250 - maturing September 30, 2034	26,913		26,877
Total subordinated debt	$	139,370	$	139,091

EARNINGS PER COMMON SHARE (Tables)

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

Schedule of Basic and Diluted Earnings per Common Share

Presented below are the calculations for basic and diluted earnings per common share for the three and nine months ended September 30, 2022 and 2021:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands, except per share data)	2022		2021		2022		2021
Net income	$	23,521	$	19,548	$	66,153	$	58,210



Common shareholder dividends	(6,400)		(6,239)		(19,186)		(18,741)
Unvested restricted stock award dividends	(70)		(60)		(218)		(186)
Undistributed earnings to unvested restricted stock awards	(185)		(126)		(519)		(386)
Undistributed earnings to common shareholders	$	16,866	$	13,123	$	46,230	$	38,897
Basic
Distributed earnings to common shareholders	$	6,400	$	6,239	$	19,186	$	18,741
Undistributed earnings to common shareholders	16,866		13,123		46,230		38,897
Total common shareholders earnings, basic	$	23,266	$	19,362	$	65,416	$	57,638
Diluted
Distributed earnings to common shareholders	$	6,400	$	6,239	$	19,186	$	18,741
Undistributed earnings to common shareholders	16,866		13,123		46,230		38,897
Total common shareholders earnings	23,266		19,362		65,416		57,638
Add back:
Undistributed earnings reallocated from unvested restricted stock awards	—		—		1		1
Total common shareholders earnings, diluted	$	23,266	$	19,362	$	65,417	$	57,639
Weighted average common shares outstanding, basic	22,338,828		22,520,499		22,306,323		22,544,898
Options	51,610		57,381		60,772		69,074
Weighted average common shares outstanding, diluted	22,390,438		22,577,880		22,367,095		22,613,972
Basic earnings per common share	$	1.04	$	0.86	$	2.93	$	2.56
Diluted earnings per common share	1.04		0.86		2.92		2.55

FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

9 Months Ended

Sep. 30, 2022

Fair Value Disclosures [Abstract]

Schedule of Assets and Liabilities Measured and Recorded at Fair Value


	September 30, 2022
(dollars in thousands)	Carrying amount		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets and liabilities measured at fair value on a recurring basis:
Assets
Investment securities available for sale:
U.S. Treasury securities	$	60,496	$	60,496	$	—	$	—
U.S. government sponsored entities and U.S. agency securities	27,865		—		27,865		—
Mortgage-backed securities - agency	391,615		—		391,615		—
Mortgage-backed securities - non-agency	21,158		—		21,158		—
State and municipal securities	95,061		—		95,061		—
Corporate securities	85,694		—		85,694		—
Equity securities	8,615		8,615		—		—
Loans held for sale	4,338		—		4,338		—
Derivative assets	17,033		—		17,033		—

Total	$	711,875	$	69,111	$	642,764	$	—
Liabilities
Derivative liabilities	$	11,512	$	—	$	11,512	$	—

Total	$	11,512	$	—	$	11,512	$	—

Assets measured at fair value on a non-recurring basis:
Loan servicing rights	$	1,297	$	—	$	—	$	1,297
Commercial FHA mortgage servicing rights held for sale	23,995		—		—		23,995
Nonperforming loans	46,882		11,516		25,128		10,238
Other real estate owned	11,141		—		11,141		—
Assets held for sale	1,271		—		1,271		—


	December 31, 2021
(dollars in thousands)	Carrying amount		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets and liabilities measured at fair value on a recurring basis:
Assets
Investment securities available for sale:
U.S. Treasury securities	$	64,917	$	64,917	$	—	$	—
U.S. government sponsored entities and U.S. agency securities	33,817		—		33,817		—
Mortgage-backed securities - agency	440,270		—		440,270		—
Mortgage-backed securities - non-agency	28,706		—		28,706		—
State and municipal securities	143,099		—		143,099		—
Corporate securities	195,794		—		194,859		935
Equity securities	9,529		9,529		—		—
Loans held for sale	32,045		—		32,045		—
Derivative assets	5,883		—		5,883		—

Total	$	954,060	$	74,446	$	878,679	$	935
Liabilities
Derivative liabilities	$	397	$	—	$	397	$	—

Total	$	397	$	—	$	397	$	—

Assets measured at fair value on a non-recurring basis:
Loan servicing rights	$	28,865	$	—	$	—	$	28,865

Nonperforming loans	36,542		24,358		6,129		6,055
Other real estate owned	12,059		—		12,059		—
Assets held for sale	2,284		—		2,284		—

Schedule Presenting Activity for Assets Measured at Fair Value on a Recurring Basis using Significant Unobservable Inputs (Level 3)


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Balance, beginning of period	$	—	$	1,008	$	935	$	959
Transferred to level 2	—		—		(935)		—
Total realized in earnings (1)	—		4		6		10
Total unrealized in other comprehensive income (2)	—		(73)				(24)
Net settlements (principal and interest)	—		(4)		(6)		(10)
Balance, end of period	$	—	$	935	$	—	$	935

(1)Amounts included in interest income from investment securities taxable in the consolidated statements of income.

(2)Represents change in unrealized gains or losses for the period included in other comprehensive income for assets held at the end of the reporting period.

Schedule Presents Quantitative Information about Significant Unobservable Inputs

(dollars in thousands)

Fair value

Valuation
technique

Unobservable
input / assumptions

Range (weighted average)(1)

December 31, 2021

Corporate securities

935

Consensus pricing

Net market price

0.0% - 7.0% (4.5)%

(1)Unobservable inputs were weighted by the relative fair value of the instruments.

Schedule of Losses Recognized on Assets Measured on a Non-recurring Basis

The following table presents losses recognized on assets measured on a nonrecurring basis for the three and nine months ended September 30, 2022 and 2021:


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Commercial mortgage servicing rights	$	—	$	3,037	$	1,263	$	5,460
Residential mortgage servicing rights held for sale	—		79		—		222
Nonperforming loans	1,423		3,405		6,381		9,677
Other real estate owned	339		9		743		426
Assets held for sale	—		—		—		—
Total losses on assets measured on a nonrecurring basis	$	1,762	$	6,530	$	8,387	$	15,785

Schedule Presents Quantitative Information about Significant Unobservable Inputs used in Fair Value Measurements of Non-recurring Assets (Level 3)

(dollars in thousands)

Fair value

Valuation
technique

Unobservable
input / assumptions

Range (weighted average)(1)

September 30, 2022

Loan servicing rights:

SBA servicing rights

715

Discounted cash flow

Prepayment speed

14.21% - 15.40% (14.95%)

Discount rate

No range (11.50%)

Residential servicing rights

582

Discounted cash flow

Prepayment speed

7.56% -31.14% (8.46%)

Discount rate

9.00% - 11.50% (10.13%)

Commercial FHA servicing rights held for sale

23,995

Discounted cash flow

Prepayment speed

8.00% - 18.00% (8.21%)

Discount rate

10.00% - 27.00% (11.48%)

December 31, 2021

Loan servicing rights:

Commercial MSR

28,368

Discounted cash flow

Prepayment speed

8.00% - 18.00% (8.24%)

Discount rate

10.00% - 27.00% (11.87%)

SBA servicing rights

898

Discounted cash flow

Prepayment speed

12.27% - 14.14% (13.88%)

Discount rate

10.00% - 12.00% (11.00%)

Residential servicing rights

705

Discounted cash flow

Prepayment speed

11.94% - 27.48% (14.94%)

Discount rate

9.00% - 11.50% (10.25%)

(1)Unobservable inputs were weighted by the relative fair value of the instruments.

Schedule of the Fair Value Option for Newly Originated Residential and Commercial Loans Held for Sale


	September 30, 2022						December 31, 2021
(dollars in thousands)	Aggregate fair value		Difference		Contractual principal		Aggregate fair value		Difference		Contractual principal
Commercial loans held for sale	$	—	$	—	$	—	$	19,230	$	—	$	19,230
Residential loans held for sale	4,338		(73)		4,411		12,815		584		12,231

Total loans held for sale	$	4,338	$	(73)	$	4,411	$	32,045	$	584	$	31,461


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Commercial loans held for sale	$	—	$	—	$	—	$	(67)
Residential loans held for sale	(280)		(231)		(557)		(294)
Total loans held for sale	$	(280)	$	(231)	$	(557)	$	(361)

Schedule Presentation of Summary of the Carrying Values and Fair Value Estimates of Certain Financial Instruments

The carrying values and estimated fair value of certain financial instruments not carried at fair value at September 30, 2022 and December 31, 2021 were as follows:


	September 30, 2022
(dollars in thousands)	Carrying amount		Fair value		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets
Cash and due from banks	$	309,531	$	309,531	$	309,531	$	—	$	—
Federal funds sold	3,657		3,657		3,657		—		—

Loans, net	6,139,812		6,025,586		—		—		6,025,586
Accrued interest receivable	17,537		17,537		—		17,537		—

Liabilities
Deposits	$	6,395,252	$	6,370,773	$	—	$	6,370,773	$	—
Short-term borrowings	58,518		58,518		—		58,518		—
FHLB and other borrowings	360,000		358,694		—		358,694		—
Subordinated debt	139,370		135,279		—		135,279		—
Trust preferred debentures	49,824		54,965		—		54,965		—


	December 31, 2021
(dollars in thousands)	Carrying amount		Fair value		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets
Cash and due from banks	$	673,297	$	673,297	$	673,297	$	—	$	—
Federal funds sold	7,074		7,074		7,074		—		—

Loans, net	5,173,739		5,221,886		—		—		5,221,886
Accrued interest receivable	19,470		19,470		—		19,470		—

Liabilities
Deposits	$	6,110,648	$	6,109,077	$	—	$	6,109,077	$	—
Short-term borrowings	76,803		76,803		—		76,803		—
FHLB and other borrowings	310,171		317,464		—		317,464		—
Subordinated debt	139,091		148,386		—		148,386		—
Trust preferred debentures	49,374		57,827		—		57,827		—

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details

COMMITMENTS, CONTINGENCIES AND CREDIT RISK (Tables)

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Schedule of Loan Commitments

The commitments are principally tied to variable rates. Loan commitments as of September 30, 2022 and December 31, 2021 were as follows:


(dollars in thousands)	September 30, 2022		December 31, 2021
Commitments to extend credit	$	1,280,312	$	994,709
Financial guarantees – standby letters of credit	31,315		14,325

SEGMENT INFORMATION (Tables)

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

Schedule of Segment Financial Information

Selected business segment financial information for the three and nine months ended September 30, 2022 and 2021 were as follows:


(dollars in thousands)	Banking		Wealth Management		Other		Total
Three Months Ended September 30, 2022
Net interest income (expense)	$	66,846	$	—	$	(2,822)	$	64,024
Provision for credit losses	6,974		—		—		6,974
Noninterest income	9,646		6,199		(19)		15,826
Noninterest expense	39,338		4,364		(206)		43,496
Income (loss) before income taxes (benefit)	30,180		1,835		(2,635)		29,380
Income taxes (benefit)	9,238		498		(3,877)		5,859
Net income (loss)	$	20,942	$	1,337	$	1,242	$	23,521
Total assets	$	7,809,280	$	29,166	$	(16,569)	$	7,821,877

Nine Months Ended September 30, 2022
Net interest income (expense)	$	190,162	$	—	$	(7,977)	$	182,185
Provision for credit losses	16,582		—		—		16,582
Noninterest income	26,547		19,481		24		46,052
Noninterest expense	112,947		13,130		(358)		125,719
Income (loss) before income taxes (benefit)	87,180		6,351		(7,595)		85,936
Income taxes (benefit)	23,498		1,761		(5,476)		19,783
Net income (loss)	$	63,682	$	4,590	$	(2,119)	$	66,153
Total assets	$	7,809,280	$	29,166	$	(16,569)	$	7,821,877

Three Months Ended September 30, 2021
Net interest income (expense)	$	53,888	$	—	$	(2,492)	$	51,396
Provision for credit losses	(184)		—		—		(184)
Noninterest income	7,917		7,175		51		15,143
Noninterest expense	37,055		4,507		(270)		41,292
Income (loss) before income taxes (benefit)	24,934		2,668		(2,171)		25,431
Income taxes (benefit)	4,973		764		146		5,883
Net income (loss)	$	19,961	$	1,904	$	(2,317)	$	19,548
Total assets	$	7,091,180	$	31,274	$	(28,495)	$	7,093,959

Nine Months Ended September 30, 2021
Net interest income (expense)	$	161,514	$	—	$	(8,140)	$	153,374
Provision for credit losses	2,926		—		—		2,926
Noninterest income	27,649		19,635		92		47,376
Noninterest expense	117,655		12,672		(1,015)		129,312
Income (loss) before income taxes (benefit)	68,582		6,963		(7,033)		68,512
Income taxes (benefit)	9,849		1,967		(1,514)		10,302
Net income (loss)	$	58,733	$	4,996	$	(5,519)	$	58,210
Total assets	$	7,091,180	$	31,274	$	(28,495)	$	7,093,959

REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables)

9 Months Ended

Sep. 30, 2022

Revenue from Contract with Customer [Abstract]

Summary of Noninterest Income, Segregated by Revenue

The following presents noninterest income, segregated by revenue streams in-scope and out-of-scope of Topic 606, for the three and nine months ended September 30, 2022 and 2021.


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2022		2021		2022		2021
Noninterest income - in-scope of Topic 606
Wealth management revenue:
Trust management/administration fees	$	5,241	$	5,623	$	16,362	$	15,054
Investment advisory fees	—		577		—		1,462
Investment brokerage fees	482		330		1,623		1,206
Other	476		645		1,496		1,913
Service charges on deposit accounts:
Nonsufficient fund fees	1,775		1,470		4,631		3,814
Other	822		798		2,338		2,196
Interchange revenues	3,531		3,651		10,401		10,823
Other income:
Merchant services revenue	448		405		1,203		1,137
Other	847		925		2,286		3,135
Noninterest income - out-of-scope of Topic 606	2,204		719		5,712		6,636
Total noninterest income	$	15,826	$	15,143	$	46,052	$	47,376

ACQUISITIONS - Narrative (Details) - USD ($) $ in Thousands	Jun. 01, 2021	Jun. 17, 2022
Business Acquisition
Transaction and integration costs		$ 400
FNBC Bank & Trust
Business Acquisition
Deposits		79,794
Loans		$ 16,632
ATG Trust
Business Acquisition
Transaction and integration costs	$ 400
Fair value of assets under management	399,700
Assets acquired	$ 2,700

ACQUISITIONS - Assets Acquired and Liabilities Assumed (Details) - FNBC Bank & Trust $ in Thousands	Jun. 17, 2022 USD ($)
Business Acquisition
Cash and cash equivalents	$ 60,275
Loans	16,632
Premises and equipment, net	950
Accrued interest receivable	36
Intangible assets	1,901
Total assets acquired	79,794
Deposits	79,794
Total liabilities assumed	79,794
Core deposit intangibles
Business Acquisition
Intangible assets	$ 1,901
Estimated useful life	10 years

INVESTMENT SECURITIES - Classified (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Jun. 30, 2022	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Dec. 31, 2020
Investment securities available for sale
Amortized cost	$ 794,950		$ 904,695
Gross unrealized gains	211		11,505
Gross unrealized losses	113,272		9,376
Allowance for credit losses	0	$ 0	221	$ 142	$ 326	$ 366
Fair value	681,889		906,603
U.S. Treasury securities
Investment securities available for sale
Amortized cost	66,369		65,347
Gross unrealized gains	0		0
Gross unrealized losses	5,873		430
Allowance for credit losses	0		0
Fair value	60,496		64,917
U.S. government sponsored entities and U.S. agency securities
Investment securities available for sale
Amortized cost	32,267		34,569
Gross unrealized gains	78		79
Gross unrealized losses	4,480		831
Allowance for credit losses	0		0
Fair value	27,865		33,817
Mortgage-backed securities - agency
Investment securities available for sale
Amortized cost	469,822		444,484
Gross unrealized gains	5		2,687
Gross unrealized losses	78,212		6,901
Allowance for credit losses	0		0
Fair value	391,615		440,270
Mortgage-backed securities - non-agency
Investment securities available for sale
Amortized cost	25,341		29,037
Gross unrealized gains	0		50
Gross unrealized losses	4,183		381
Allowance for credit losses	0	0	0	0	113	0
Fair value	21,158		28,706
State and municipal securities
Investment securities available for sale
Amortized cost	105,838		137,904
Gross unrealized gains	128		5,561
Gross unrealized losses	10,905		366
Allowance for credit losses	0	0	0	0	0	29
Fair value	95,061		143,099
Corporate securities
Investment securities available for sale
Amortized cost	95,313		193,354
Gross unrealized gains	0		3,128
Gross unrealized losses	9,619		467
Allowance for credit losses	0	$ 0	221	$ 142	$ 213	$ 337
Fair value	$ 85,694		$ 195,794

INVESTMENT SECURITIES - Amortized cost and fair value (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Amortized cost
Within one year	$ 9,766		$ 9,766
After one year through five years	123,074		123,074
After five years through ten years	135,520		135,520
After ten years	31,427		31,427
Mortgage-backed securities	495,163		495,163
Total available for sale securities	794,950		794,950		$ 904,695
Fair value
Within one year	9,793		9,793
After one year through five years	113,574		113,574
After five years through ten years	119,588		119,588
After ten years	26,161		26,161
Mortgage-backed securities	412,773		412,773
Total available for sale securities	681,889		681,889		$ 906,603
Proceeds from sales of investment securities available for sale	28,663	$ 2,160	136,403	$ 14,777
Gross realized gains on sales	113	160	829	537
Gross realized losses on sales	$ (242)	$ 0	$ (1,059)	$ 0

INVESTMENT SECURITIES - Allowance for credit loss and unrealized losses and fair values (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Allowance for credit losses on investment securities available-for-sale
Beginning balance	$ 0	$ 326	$ 221	$ 366
Current-period provision for expected credit losses	0	(184)	(221)	(224)
Ending balance	0	142	0	142
Fair value
Less than 12 Months, Fair value	326,791		326,791		$ 451,195
Less than 12 Months, Unrealized loss	36,687		36,687		7,977
12 Months or more, Fair value	334,164		334,164		21,021
12 Months or more, Unrealized loss	76,585		76,585		932
Total, Fair value	660,955		660,955		472,216
Total, Unrealized loss	113,272		113,272		8,909
U.S. Treasury securities
Allowance for credit losses on investment securities available-for-sale
Beginning balance			0
Ending balance	0		0
Fair value
Less than 12 Months, Fair value	37,689		37,689		64,917
Less than 12 Months, Unrealized loss	3,305		3,305		430
12 Months or more, Fair value	22,807		22,807		0
12 Months or more, Unrealized loss	2,568		2,568		0
Total, Fair value	60,496		60,496		64,917
Total, Unrealized loss	5,873		5,873		430
U.S. government sponsored entities and U.S. agency securities
Allowance for credit losses on investment securities available-for-sale
Beginning balance			0
Ending balance	0		0
Fair value
Less than 12 Months, Fair value	333		333		17,487
Less than 12 Months, Unrealized loss	19		19		263
12 Months or more, Fair value	23,289		23,289		9,432
12 Months or more, Unrealized loss	4,461		4,461		568
Total, Fair value	23,622		23,622		26,919
Total, Unrealized loss	4,480		4,480		831
Mortgage-backed securities - agency
Allowance for credit losses on investment securities available-for-sale
Beginning balance			0
Ending balance	0		0
Fair value
Less than 12 Months, Fair value	168,562		168,562		317,372
Less than 12 Months, Unrealized loss	21,838		21,838		6,633
12 Months or more, Fair value	222,652		222,652		9,051
12 Months or more, Unrealized loss	56,374		56,374		268
Total, Fair value	391,214		391,214		326,423
Total, Unrealized loss	78,212		78,212		6,901
Mortgage-backed securities - non-agency
Allowance for credit losses on investment securities available-for-sale
Beginning balance	0	113	0	0
Current-period provision for expected credit losses	0	(113)	0	0
Ending balance	0	0	0	0
Fair value
Less than 12 Months, Fair value	6,228		6,228		24,095
Less than 12 Months, Unrealized loss	879		879		381
12 Months or more, Fair value	14,930		14,930		0
12 Months or more, Unrealized loss	3,304		3,304		0
Total, Fair value	21,158		21,158		24,095
Total, Unrealized loss	4,183		4,183		381
State and municipal securities
Allowance for credit losses on investment securities available-for-sale
Beginning balance	0	0	0	29
Current-period provision for expected credit losses	0	0	0	(29)
Ending balance	0	0	0	0
Fair value
Less than 12 Months, Fair value	56,578		56,578		27,324
Less than 12 Months, Unrealized loss	5,879		5,879		270
12 Months or more, Fair value	22,193		22,193		2,538
12 Months or more, Unrealized loss	5,026		5,026		96
Total, Fair value	78,771		78,771		29,862
Total, Unrealized loss	10,905		10,905		366
Corporate securities
Allowance for credit losses on investment securities available-for-sale
Beginning balance	0	213	221	337
Current-period provision for expected credit losses	0	(71)	(221)	(195)
Ending balance	0	$ 142	0	$ 142
Fair value
Less than 12 Months, Fair value	57,401		57,401		0
Less than 12 Months, Unrealized loss	4,767		4,767		0
12 Months or more, Fair value	28,293		28,293		0
12 Months or more, Unrealized loss	4,852		4,852		0
Total, Fair value	85,694		85,694		0
Total, Unrealized loss	$ 9,619		$ 9,619		$ 0

INVESTMENT SECURITIES - Narrative (Details) $ in Thousands	Sep. 30, 2022 USD ($) security	Dec. 31, 2021 USD ($)
Investments, Debt and Equity Securities [Abstract]
Number of securities in unrealized loss position (in security) \| security	393
Aggregate depreciation percentage	14.63%
Equity securities recorded at fair value \| $	$ 8,615	$ 9,529

INVESTMENT SECURITIES - Equity Securities (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Investments, Debt and Equity Securities [Abstract]
Net unrealized (losses) gains	$ (118)	$ 112	$ (1,065)	$ 338

LOANS - Summary of loans and credit losses (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Summary of loans
Loans	$ 6,198,451		$ 6,198,451		$ 5,224,801
Net deferred loan fees	4,200		4,200		4,600
Unearned income	54,000		54,000		46,100
Loans held for sale	4,338		4,338		32,045
Proceeds from sales of loans held for sale			252,078	$ 634,445
Commercial Loan Portfolio
Summary of loans
Loans	4,228,135		4,228,135		3,460,765
Lease financing
Summary of loans
Loans	457,611		457,611		423,280
Commercial Real Estate, Residential Real Estate And Consumer Loans
Summary of loans
Proceeds from sales of loans held for sale	48,500	$ 139,900	252,100	$ 634,400
Commercial \| Commercial Loan Portfolio
Summary of loans
Loans	852,930		852,930		770,670
Commercial other \| Commercial Loan Portfolio
Summary of loans
Loans	683,353		683,353		679,518
Commercial real estate non-owner occupied \| Commercial Loan Portfolio
Summary of loans
Loans	1,567,308		1,567,308		1,105,333
Commercial real estate owner occupied \| Commercial Loan Portfolio
Summary of loans
Loans	505,174		505,174		469,658
Multi-family \| Commercial Loan Portfolio
Summary of loans
Loans	328,473		328,473		171,875
Farmland \| Commercial Loan Portfolio
Summary of loans
Loans	65,348		65,348		69,962
Construction and land development \| Commercial Loan Portfolio
Summary of loans
Loans	225,549		225,549		193,749
Residential first lien \| Residential Portfolio Segment
Summary of loans
Loans	294,432		294,432		274,412
Other residential \| Residential Portfolio Segment
Summary of loans
Loans	61,793		61,793		63,739
Consumer \| Consumer
Summary of loans
Loans	110,226		110,226		106,008
Consumer other \| Consumer
Summary of loans
Loans	1,046,254		1,046,254		896,597
Payroll Protection Program \| Commercial Loan Portfolio
Summary of loans
Loans	2,800		2,800		52,500
Commercial FHA Warehouse Lines \| Commercial Loan Portfolio
Summary of loans
Loans	$ 51,300		$ 51,300		$ 91,900

LOANS - Loans to Directors, Executive Officers, Principal Shareholders and Affiliates (Details) - Directors, Executive Officers, Principal Shareholders and Affiliates - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Jun. 30, 2022	Dec. 31, 2021	Jun. 30, 2021	Dec. 31, 2020
Notes Receivable [Roll Forward]
Beginning balance	$ 20,016	$ 15,359	$ 20,016	$ 15,359	$ 23,097	$ 13,869	$ 18,762	$ 19,693
New loans and other additions	0	21	9,804	1,045
Repayments and other reductions	(3,081)	(3,424)	(3,657)	(5,379)
Ending balance	$ 20,016	$ 15,359	$ 20,016	$ 15,359

LOANS - Summary of changes in the ACL on loans (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Changes in allowance for credit losses on loans
Balance, beginning of period	$ 54,898	$ 58,664	$ 51,062	$ 60,443
Provision for credit losses on loans	6,974	0	15,847	3,950
Charge-offs	(3,854)	(3,660)	(10,276)	(10,271)
Recoveries	621	671	2,006	1,553
Balance, end of period	58,639	55,675	58,639	55,675
Commercial Loan Portfolio \| Commercial
Changes in allowance for credit losses on loans
Balance, beginning of period	12,748	14,849	14,375	19,851
Provision for credit losses on loans	3,226	(75)	3,504	(2,091)
Charge-offs	(1,655)	(317)	(3,869)	(3,457)
Recoveries	45	134	354	288
Balance, end of period	14,364	14,591	14,364	14,591
Commercial Loan Portfolio \| Commercial real estate
Changes in allowance for credit losses on loans
Balance, beginning of period	27,874	30,718	22,993	25,465
Provision for credit losses on loans	1,787	(2,105)	9,515	4,854
Charge-offs	(1,232)	(1,663)	(4,084)	(3,382)
Recoveries	1	3	6	16
Balance, end of period	28,430	26,953	28,430	26,953
Commercial Loan Portfolio \| Construction and land development
Changes in allowance for credit losses on loans
Balance, beginning of period	1,101	1,733	972	1,433
Provision for credit losses on loans	472	(538)	595	(113)
Charge-offs	0	(138)	(6)	(410)
Recoveries	18	74	30	221
Balance, end of period	1,591	1,131	1,591	1,131
Residential Portfolio Segment \| Residential real estate
Changes in allowance for credit losses on loans
Balance, beginning of period	3,416	3,683	2,695	3,929
Provision for credit losses on loans	852	(697)	1,569	(806)
Charge-offs	(166)	(35)	(315)	(286)
Recoveries	69	66	222	180
Balance, end of period	4,171	3,017	4,171	3,017
Consumer \| Consumer
Changes in allowance for credit losses on loans
Balance, beginning of period	2,994	2,292	2,558	2,338
Provision for credit losses on loans	606	292	1,278	429
Charge-offs	(316)	(280)	(812)	(740)
Recoveries	121	93	381	370
Balance, end of period	3,405	2,397	3,405	2,397
Lease financing
Changes in allowance for credit losses on loans
Balance, beginning of period	6,765	5,389	7,469	7,427
Provision for credit losses on loans	31	3,123	(614)	1,677
Charge-offs	(485)	(1,227)	(1,190)	(1,996)
Recoveries	367	301	1,013	478
Balance, end of period	$ 6,678	$ 7,586	$ 6,678	$ 7,586

LOANS - Risk rating (Details) - Consumer Loans And Equipment Finance Loans And Leases	Sep. 30, 2022
Credit Risk State One \| Minimum
Risk category
Consumer loans and equipment finance loans and leases days past due	0 days
Credit Risk State One \| Maximum
Risk category
Consumer loans and equipment finance loans and leases days past due	14 days
Credit Risk State Two \| Minimum
Risk category
Consumer loans and equipment finance loans and leases days past due	15 days
Credit Risk State Two \| Maximum
Risk category
Consumer loans and equipment finance loans and leases days past due	29 days
Credit Risk State Three \| Minimum
Risk category
Consumer loans and equipment finance loans and leases days past due	30 days
Credit Risk State Three \| Maximum
Risk category
Consumer loans and equipment finance loans and leases days past due	59 days
Credit Risk State Four \| Minimum
Risk category
Consumer loans and equipment finance loans and leases days past due	60 days
Credit Risk State Four \| Maximum
Risk category
Consumer loans and equipment finance loans and leases days past due	89 days
Credit Risk State Default \| Minimum
Risk category
Consumer loans and equipment finance loans and leases days past due	90 days

LOANS - Non-accrual (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Impaired loans (excluding PCI loans) by portfolio
Threshold amount for non accrual loans	$ 500
Nonaccrual
Nonaccrual with allowance	16,449	$ 19,237
Nonaccrual with no allowance	23,602	16,326
Total nonaccrual	40,051	35,563
Commercial Loan Portfolio
Nonaccrual
Nonaccrual with allowance	11,189	13,665
Nonaccrual with no allowance	22,969	15,494
Total nonaccrual	34,158	29,159
Commercial Loan Portfolio \| Commercial
Nonaccrual
Nonaccrual with allowance	4,179	4,681
Nonaccrual with no allowance	508	2,275
Total nonaccrual	4,687	6,956
Commercial Loan Portfolio \| Commercial other
Nonaccrual
Nonaccrual with allowance	2,104	4,467
Nonaccrual with no allowance	0	0
Total nonaccrual	2,104	4,467
Commercial Loan Portfolio \| Commercial real estate non-owner occupied
Nonaccrual
Nonaccrual with allowance	1,590	1,914
Nonaccrual with no allowance	12,118	9,912
Total nonaccrual	13,708	11,826
Commercial Loan Portfolio \| Commercial real estate owner occupied
Nonaccrual
Nonaccrual with allowance	2,882	2,164
Nonaccrual with no allowance	1,340	1,340
Total nonaccrual	4,222	3,504
Commercial Loan Portfolio \| Multi-family
Nonaccrual
Nonaccrual with allowance	164	201
Nonaccrual with no allowance	9,003	1,967
Total nonaccrual	9,167	2,168
Commercial Loan Portfolio \| Farmland
Nonaccrual
Nonaccrual with allowance	25	155
Nonaccrual with no allowance	0	0
Total nonaccrual	25	155
Commercial Loan Portfolio \| Construction and land development
Nonaccrual
Nonaccrual with allowance	245	83
Nonaccrual with no allowance	0	0
Total nonaccrual	245	83
Residential Portfolio Segment \| Residential first lien
Nonaccrual
Nonaccrual with allowance	2,884	3,116
Nonaccrual with no allowance	633	832
Total nonaccrual	3,517	3,948
Residential Portfolio Segment \| Other residential
Nonaccrual
Nonaccrual with allowance	798	836
Nonaccrual with no allowance	0	0
Total nonaccrual	798	836
Consumer \| Consumer
Nonaccrual
Nonaccrual with allowance	72	110
Nonaccrual with no allowance	0	0
Total nonaccrual	72	110
Lease financing \| Lease financing
Nonaccrual
Nonaccrual with allowance	1,506	1,510
Nonaccrual with no allowance	0	0
Total nonaccrual	$ 1,506	$ 1,510

LOANS - Impaired Loans with interest recognized (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Interest income :
Interest income recognized on nonaccrual loans	$ 0	$ 0	$ 0	$ 0
Additional interest income that would have been recorded had they been current	$ 800,000	$ 600,000	$ 1,900,000	$ 2,100,000

LOANS - Collateral dependent loans (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Summary of loans
Collateral dependent loans	$ 19,496	$ 20,813
Real Estate
Summary of loans
Collateral dependent loans	15,864	14,909
Blanket Lien
Summary of loans
Collateral dependent loans	3,244	5,402
Equipment
Summary of loans
Collateral dependent loans	388	502
Commercial \| Commercial Loan Portfolio
Summary of loans
Collateral dependent loans	3,244	5,402
Commercial \| Commercial Loan Portfolio \| Real Estate
Summary of loans
Collateral dependent loans	0	0
Commercial \| Commercial Loan Portfolio \| Blanket Lien
Summary of loans
Collateral dependent loans	3,244	5,402
Commercial \| Commercial Loan Portfolio \| Equipment
Summary of loans
Collateral dependent loans	0	0
Commercial other \| Commercial Loan Portfolio
Summary of loans
Collateral dependent loans	278	502
Commercial other \| Commercial Loan Portfolio \| Real Estate
Summary of loans
Collateral dependent loans	0	0
Commercial other \| Commercial Loan Portfolio \| Blanket Lien
Summary of loans
Collateral dependent loans	0	0
Commercial other \| Commercial Loan Portfolio \| Equipment
Summary of loans
Collateral dependent loans	278	502
Commercial real estate non-owner occupied \| Commercial Loan Portfolio
Summary of loans
Collateral dependent loans	12,655	11,604
Commercial real estate non-owner occupied \| Commercial Loan Portfolio \| Real Estate
Summary of loans
Collateral dependent loans	12,655	11,604
Commercial real estate non-owner occupied \| Commercial Loan Portfolio \| Blanket Lien
Summary of loans
Collateral dependent loans	0	0
Commercial real estate non-owner occupied \| Commercial Loan Portfolio \| Equipment
Summary of loans
Collateral dependent loans	0	0
Commercial real estate owner occupied \| Commercial Loan Portfolio
Summary of loans
Collateral dependent loans	1,336	1,336
Commercial real estate owner occupied \| Commercial Loan Portfolio \| Real Estate
Summary of loans
Collateral dependent loans	1,336	1,336
Commercial real estate owner occupied \| Commercial Loan Portfolio \| Blanket Lien
Summary of loans
Collateral dependent loans	0	0
Commercial real estate owner occupied \| Commercial Loan Portfolio \| Equipment
Summary of loans
Collateral dependent loans	0	0
Multi-family \| Commercial Loan Portfolio
Summary of loans
Collateral dependent loans	1,873	1,969
Multi-family \| Commercial Loan Portfolio \| Real Estate
Summary of loans
Collateral dependent loans	1,873	1,969
Multi-family \| Commercial Loan Portfolio \| Blanket Lien
Summary of loans
Collateral dependent loans	0	0
Multi-family \| Commercial Loan Portfolio \| Equipment
Summary of loans
Collateral dependent loans	0	$ 0
Lease financing \| Lease financing
Summary of loans
Collateral dependent loans	110
Lease financing \| Lease financing \| Real Estate
Summary of loans
Collateral dependent loans	0
Lease financing \| Lease financing \| Blanket Lien
Summary of loans
Collateral dependent loans	0
Lease financing \| Lease financing \| Equipment
Summary of loans
Collateral dependent loans	$ 110

LOANS - TDRs by portfolio (Details) - USD ($)	9 Months Ended	12 Months Ended
LOANS - TDRs by portfolio (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Troubled debt restructuring
Allowance for loan losses on TDRs	$ 500,000	$ 700,000
Unfunded commitments	0	0
TDRs by loan portfolio (excluding PCI loans):
TDR's Accruing	6,136,000	7,012,000
TDR's Nonaccrual	3,861,000	5,749,000
Total	9,997,000	12,761,000
COVID-19
Troubled debt restructuring
Modifications not considered TDRs	0	13,300,000
Commercial Loan Portfolio \| Commercial
TDRs by loan portfolio (excluding PCI loans):
TDR's Accruing	1,727,000	833,000
TDR's Nonaccrual	511,000	1,422,000
Total	2,238,000	2,255,000
Commercial Loan Portfolio \| Commercial real estate
TDRs by loan portfolio (excluding PCI loans):
TDR's Accruing	113,000	1,522,000
TDR's Nonaccrual	2,627,000	3,302,000
Total	2,740,000	4,824,000
Commercial Loan Portfolio \| Construction and land development
TDRs by loan portfolio (excluding PCI loans):
TDR's Accruing	29,000	37,000
TDR's Nonaccrual	0	0
Total	29,000	37,000
Residential Portfolio Segment \| Residential real estate
TDRs by loan portfolio (excluding PCI loans):
TDR's Accruing	3,384,000	3,128,000
TDR's Nonaccrual	702,000	784,000
Total	4,086,000	3,912,000
Consumer \| Consumer
TDRs by loan portfolio (excluding PCI loans):
TDR's Accruing	59,000	98,000
TDR's Nonaccrual	0	0
Total	59,000	98,000
Lease financing
TDRs by loan portfolio (excluding PCI loans):
TDR's Accruing	824,000	1,394,000
TDR's Nonaccrual	21,000	241,000
Total	$ 845,000	$ 1,635,000

LOANS - TDRs by portfolio - restructured and subsequently defaulted (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022 USD ($) loan	Sep. 30, 2021 USD ($) loan	Sep. 30, 2022 USD ($) loan	Sep. 30, 2021 USD ($) loan
Troubled debt restructurings:
Number of loans \| loan	2	6	17	20
Pre-modification outstanding balance	$ 56	$ 500	$ 1,781	$ 3,336
Post-modification outstanding balance	$ 56	$ 478	$ 1,779	$ 3,309
Commercial Loan Portfolio \| Commercial
Troubled debt restructurings:
Number of loans \| loan	0	2	4	7
Pre-modification outstanding balance	$ 0	$ 114	$ 1,324	$ 723
Post-modification outstanding balance	$ 0	$ 114	$ 1,324	$ 723
Commercial Loan Portfolio \| Commercial real estate
Troubled debt restructurings:
Number of loans \| loan	0	1	1	2
Pre-modification outstanding balance	$ 0	$ 152	$ 6	$ 1,584
Post-modification outstanding balance	$ 0	$ 130	$ 6	$ 1,562
Commercial Loan Portfolio \| Construction and land development
Troubled debt restructurings:
Number of loans \| loan	0	0	0	1
Pre-modification outstanding balance	$ 0	$ 0	$ 0	$ 49
Post-modification outstanding balance	$ 0	$ 0	$ 0	$ 40
Residential Portfolio Segment \| Residential real estate
Troubled debt restructurings:
Number of loans \| loan	2	0	7	3
Pre-modification outstanding balance	$ 56	$ 0	$ 260	$ 191
Post-modification outstanding balance	$ 56	$ 0	$ 260	$ 195
Consumer \| Consumer
Troubled debt restructurings:
Number of loans \| loan	0	0	3	3
Pre-modification outstanding balance	$ 0	$ 0	$ 107	$ 50
Post-modification outstanding balance	$ 0	$ 0	$ 105	$ 50
Lease financing
Troubled debt restructurings:
Number of loans \| loan	0	3	2	4
Pre-modification outstanding balance	$ 0	$ 234	$ 84	$ 739
Post-modification outstanding balance	$ 0	$ 234	$ 84	$ 739

PREMISES, EQUIPMENT AND LEASES - Premises and Equipment (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Property, Plant and Equipment [Line Items]
Lease right-of-use assets	$ 7,582	$ 8,428
Total	126,904	124,812
Accumulated depreciation	(49,385)	(45,592)
Premises and equipment, net	77,519	79,220
Land
Property, Plant and Equipment [Line Items]
Premises and equipment gross	15,803	15,696
Buildings and improvements
Property, Plant and Equipment [Line Items]
Premises and equipment gross	69,573	67,143
Furniture and equipment
Property, Plant and Equipment [Line Items]
Premises and equipment gross	$ 33,946	$ 33,545

PREMISES, EQUIPMENT AND LEASES - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Property, Plant and Equipment [Line Items]
Depreciation on premises and equipment	$ 1,200	$ 1,400	$ 3,665	$ 4,223
Renewal term of lease (in years)	10 years		10 years
Operating lease liabilities	$ 9,513		$ 9,513		$ 10,700
Minimum
Property, Plant and Equipment [Line Items]
Remaining lease terms	2 months		2 months
Maximum
Property, Plant and Equipment [Line Items]
Remaining lease terms	10 years		10 years

PREMISES, EQUIPMENT AND LEASES - Information Related to Operating Leases (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Property, Plant and Equipment [Abstract]
Operating lease cost	$ 533	$ 510	$ 1,576	$ 1,547
Operating cash flows from leases	638	589	1,874	1,975
Right-of-use assets obtained in exchange for lease obligations	80	0	502	689
Right-of-use assets derecognized due to terminations or impairment	$ 0	$ 0	$ 0	$ (210)
Weighted average remaining lease term	7 years 3 months 18 days	7 years 9 months 18 days	7 years 3 months 18 days	7 years 9 months 18 days
Weighted average discount rate	2.88%	2.88%	2.88%	2.88%

PREMISES, EQUIPMENT AND LEASES - Projected Minimum Rental Payments (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Property, Plant and Equipment [Abstract]
2022 remaining	$ 419
2023	2,185
2024	1,879
2025	975
2026	843
Thereafter	4,296
Total future minimum lease payments	10,597
Less imputed interest	(1,084)
Operating lease liabilities	$ 9,513	$ 10,700

LOAN SERVICING RIGHTS - Loan Servicing Rights and Carrying Value (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Servicing Assets at Fair Value [Line Items]
Serviced Loans	$ 2,673,579	$ 3,003,192
Carrying Value	25,292	28,865
Commercial FHA
Servicing Assets at Fair Value [Line Items]
Serviced Loans	0	2,650,531
Carrying Value	0	27,386
SBA
Servicing Assets at Fair Value [Line Items]
Serviced Loans	46,799	50,043
Carrying Value	715	774
Residential
Servicing Assets at Fair Value [Line Items]
Serviced Loans	264,318	302,618
Carrying Value	582	705
Commercial FHA held for sale
Servicing Assets at Fair Value [Line Items]
Serviced Loans	2,362,462	0
Carrying Value	$ 23,995	$ 0

LOAN SERVICING RIGHTS - Changes in MSR (Details) - Commercial FHA - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Jun. 30, 2022	Dec. 31, 2021	Jun. 30, 2021	Dec. 31, 2020
Loan servicing rights:
Loan servicing rights, Beginning balance	$ 24,603	$ 33,732	$ 27,386	$ 38,322
Servicing rights transferred to held for sale	(23,995)	0	(23,995)	0
Amortization	(608)	(721)	(1,907)	(2,284)
Refinancing fee received from third party	0	165	(221)	(439)
Permanent impairment	0	(3,037)	(1,263)	(5,460)
Loan servicing rights, Ending balance	0	30,139	0	30,139
Fair value, Beginning of period	0	31,012	0	31,012	$ 26,865	$ 28,368	$ 34,255	$ 38,322
Fair value, End of period	$ 0	$ 31,012	$ 0	$ 31,012

LOAN SERVICING RIGHTS - Narrative (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Transfers and Servicing [Abstract]
Commercial FHA mortgage loan servicing rights held for sale	$ 23,995	$ 0
Prepayment rate	8.21%	8.24%
Discount rate	11.48%	11.87%

GOODWILL AND INTANGIBLE ASSETS - Goodwill (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Goodwill [Line Items]
Goodwill	$ 161,904	$ 161,904
Banking
Goodwill [Line Items]
Goodwill	157,158	157,158
Wealth management
Goodwill [Line Items]
Goodwill	$ 4,746	$ 4,746

- Definition

Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized.

+ References + Details

GOODWILL AND INTANGIBLE ASSETS - Intangible assets (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
	Jun. 17, 2022	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Finite-lived intangible assets
Gross carrying amount		$ 74,832		$ 74,832		$ 72,930
Accumulated amortization		(52,634)		(52,634)		(48,556)
Total		22,198		22,198		24,374
Amortization of intangible assets		1,361	$ 1,445	4,077	$ 4,430
FNBC Bank & Trust
Finite-lived intangible assets
Intangible assets	$ 1,901
Core deposit intangibles
Finite-lived intangible assets
Gross carrying amount		58,913		58,913		57,012
Accumulated amortization		(43,708)		(43,708)		(40,603)
Total		15,205		15,205		16,409
Core deposit intangibles \| FNBC Bank & Trust
Finite-lived intangible assets
Intangible assets	$ 1,901
Estimated useful life	10 years
Customer relationship intangibles
Finite-lived intangible assets
Gross carrying amount		15,919		15,919		15,918
Accumulated amortization		(8,926)		(8,926)		(7,953)
Total		$ 6,993		$ 6,993		$ 7,965

DERIVATIVE INSTRUMENTS - Interest Rate Lock Commitments and Forward Commitments (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Fair value of the Company's derivative financial instruments as well as their classification on the consolidated statements of condition
Fair value gain (loss)	$ (317)	$ (19)
Notional amount, liability	9,138	18,362
Other assets
Fair value of the Company's derivative financial instruments as well as their classification on the consolidated statements of condition
Notational amount, asset	15,473	126,643
Fair value gain (loss)	150	410
Interest rate lock commitments \| Other assets
Fair value of the Company's derivative financial instruments as well as their classification on the consolidated statements of condition
Notational amount, asset	4,419	66,216
Fair value gain (loss)	(15)	410
Interest rate lock commitments \| Other liabilities
Fair value of the Company's derivative financial instruments as well as their classification on the consolidated statements of condition
Fair value gain (loss)	(317)	0
Notional amount, liability	9,138	0
Forward commitments to sell mortgage-backed securities \| Other assets
Fair value of the Company's derivative financial instruments as well as their classification on the consolidated statements of condition
Notational amount, asset	11,054	60,427
Fair value gain (loss)	165	0
Forward commitments to sell mortgage-backed securities \| Other liabilities
Fair value of the Company's derivative financial instruments as well as their classification on the consolidated statements of condition
Fair value gain (loss)	0	(19)
Notional amount, liability	$ 0	$ 18,362

DERIVATIVE INSTRUMENTS - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Derivative disclosures
Derivative, gain (loss) on derivative, net	$ (0.2)	$ (0.4)	$ (0.6)	$ (1.3)
Interest rate swap contracts
Derivative disclosures
Notional amount of interest rate swaps	7.6		7.6		$ 7.9
Interest rate swap contracts \| Other liabilities
Derivative disclosures
Fair value of offsetting counterparty derivative instruments	$ 0.5		$ 0.5		$ 0.4

DERIVATIVE INSTRUMENTS - Cash Flow Hedges (Details) - Cash Flow Hedge - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Receive Fixed, Pay Variable Interest Rate Swaps
Derivative disclosures
Notational amount, asset	$ 200,000
Fair value loss included in other liabilities	(10,734)
Tax effected amount included in accumulated other comprehensive (loss) income	$ (7,836)
Average remaining life	3 years 7 months 6 days
Receive Fixed, Pay Variable Interest Rate Swaps \| Long
Derivative disclosures
Weighted average rate	6.25%
Receive Fixed, Pay Variable Interest Rate Swaps \| Short
Derivative disclosures
Weighted average rate	5.48%
Future Starting Receive Fixed, Pay Variable Interest Rate Swaps
Derivative disclosures
Notational amount, asset	$ 140,000	$ 140,000
Fair value loss included in other liabilities	16,422	5,095
Tax effected amount included in accumulated other comprehensive (loss) income	$ 11,988	$ 3,694

DEPOSITS (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Classification of deposits
Noninterest-bearing demand	$ 2,025,237	$ 2,245,701
Interest-bearing:
Checking	1,905,439	1,663,021
Money market	1,125,333	869,067
Savings	704,245	679,115
Time	634,998	653,744
Total deposits	$ 6,395,252	$ 6,110,648

SHORT-TERM BORROWINGS (Details) - USD ($)	9 Months Ended	12 Months Ended
SHORT-TERM BORROWINGS (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Short-term Debt [Line Items]
Outstanding at period-end	$ 58,518,000	$ 76,803,000
Average amount outstanding	62,495,000	68,986,000
Maximum amount outstanding at any month end	$ 76,807,000	$ 77,497,000
Weighted average interest rate:
During period	0.16%	0.12%
End of period	0.26%	0.13%
Short-Term Borrowings
Investment securities pledged/collateralized for secured borrowings	$ 61,500,000	$ 78,300,000
Line of credit	0	0
Loans	6,198,451,000	5,224,801,000
Line of credit facility, maximum borrowing capacity	45,000,000
Commercial real estate \| Asset Pledged as Collateral
Short-Term Borrowings
Loans	15,700,000	64,800,000
Federal Reserve Discount Window
Short-Term Borrowings
Line of credit	$ 13,500,000	$ 55,900,000

FHLB ADVANCES AND OTHER BORROWINGS (Details) - USD ($) $ / shares in Units, $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Oct. 12, 2021
FHLB ADVANCES AND OTHER BORROWINGS
Total FHLB advances and other borrowings	$ 360,000	$ 310,171
Preferred stock, shares issued (in shares)	115,000
Preferred stock, par value (in dollars per share)	$ 2.00
FHLB advances, collateral for mortgage and home equity line of credit loans	$ 2,710,000	2,100,000
Midland States Bancorp, Inc. \| Series G Preferred Stock
FHLB ADVANCES AND OTHER BORROWINGS
Long term debt	$ 0	$ 171
Preferred stock, shares issued (in shares)	171	171
Preferred stock, par value (in dollars per share)	$ 1,000	$ 1,000
Midland States Bancorp, Inc. \| Line of Credit
FHLB ADVANCES AND OTHER BORROWINGS
Long term debt	$ 0	$ 0
Face amount			$ 15,000
Midland States Bancorp, Inc. \| Line of Credit \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
FHLB ADVANCES AND OTHER BORROWINGS
Interest rate	1.60%	1.60%
Midland States Bank \| Putable fixed rate maturing through December 2024
FHLB ADVANCES AND OTHER BORROWINGS
Total FHLB advances and other borrowings	$ 110,000	$ 210,000
Interest rate	2.35%	1.48%
Midland States Bank \| Floater rate maturing October 2023
FHLB ADVANCES AND OTHER BORROWINGS
Total FHLB advances and other borrowings	$ 100,000	$ 100,000
Midland States Bank \| Floater rate maturing October 2023 \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
FHLB ADVANCES AND OTHER BORROWINGS
Interest rate	4.60%	1.67%
Midland States Bank \| Short term fixed rate maturing through October 2022
FHLB ADVANCES AND OTHER BORROWINGS
Total FHLB advances and other borrowings	$ 150,000	$ 0
Interest rate	3.14%	3.14%

SUBORDINATED DEBT - Subordinated Debt (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Subordinated Borrowing [Line Items]
Carrying amount	$ 139,370	$ 139,091
6.50% Subordinated Debt
Subordinated Borrowing [Line Items]
Carrying amount	$ 547	$ 546
Fixed interest rate	6.50%	6.50%
Face amount	$ 550	$ 550
6.25% Subordinated Debt
Subordinated Borrowing [Line Items]
Carrying amount	$ 39,674	$ 39,626
Fixed interest rate	6.25%	6.25%
Face amount	$ 40,000	$ 40,000
5.00% Subordinated Debt
Subordinated Borrowing [Line Items]
Carrying amount	$ 72,236	$ 72,042
Fixed interest rate	5.00%	5.00%
Face amount	$ 72,750	$ 72,750
5.50% Subordinated Debt
Subordinated Borrowing [Line Items]
Carrying amount	$ 26,913	$ 26,877
Fixed interest rate	5.50%	5.50%
Face amount	$ 27,250	$ 27,250
LIBOR \| 6.25% Subordinated Debt
Subordinated Borrowing [Line Items]
Variable interest rate	4.23%	4.23%
Three month SOFR \| 5.00% Subordinated Debt
Subordinated Borrowing [Line Items]
Variable interest rate	3.61%	3.61%
Three month SOFR \| 5.50% Subordinated Debt
Subordinated Borrowing [Line Items]
Variable interest rate	4.05%	4.05%

SUBORDINATED DEBT - Narrative (Details) - 6.25% Subordinated Debt - USD ($) $ in Thousands	Oct. 15, 2022	Sep. 30, 2022	Dec. 31, 2021
Subordinated Borrowing [Line Items]
Face amount		$ 40,000	$ 40,000
Fixed interest rate		6.25%	6.25%
Subsequent Event
Subordinated Borrowing [Line Items]
Face amount	$ 40,000
Redemption price percentage	100.00%
Fixed interest rate	6.25%
Interest expense	$ 2,500

PREFERRED STOCK (Details) - USD ($) $ / shares in Units, $ in Thousands		9 Months Ended
	Aug. 24, 2022	Sep. 30, 2022	Sep. 30, 2021
Class of Stock [Line Items]
Preferred stock, shares issued (in shares)		115,000
Preferred stock, par value (in dollars per share)		$ 2.00
Preferred stock, liquidation price (in dollars per share)		$ 1,000
Proceeds from Series A preferred stock offering		$ 110,548	$ 0
Depository Shares
Class of Stock [Line Items]
Preferred stock, shares issued (in shares)	4,600,000
Preferred stock ownership interest percentage	2.50%
Preferred stock, liquidation price (in dollars per share)	$ 25
Preferred stock, redemption price (in dollars per share)	$ 25
Preferred stock
Class of Stock [Line Items]
Preferred stock fixed rate	7.75%
Preferred stock, par value (in dollars per share)	$ 2.00
Preferred stock, liquidation price (in dollars per share)	$ 1,000
Proceeds from Series A preferred stock offering	$ 115,000
Offering costs	4,500
Underwriting discount and other expenses	$ 110,500
Dividends basis spread	4.713%
Preferred stock, redemption price (in dollars per share)	$ 1,000

EARNINGS PER COMMON SHARE - Narrative (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Stock option
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	45,698	69,145	45,698	69,145

EARNINGS PER COMMON SHARE - Basic and Diluted Earnings per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Earnings Per Share [Abstract]
Net income	$ 23,521	$ 19,548	$ 66,153	$ 58,210
Common shareholder dividends	(6,400)	(6,239)	(19,186)	(18,741)
Unvested restricted stock award dividends	(70)	(60)	(218)	(186)
Undistributed earnings to unvested restricted stock awards	(185)	(126)	(519)	(386)
Undistributed earnings to common shareholders	16,866	13,123	46,230	38,897
Basic
Distributed earnings to common shareholders	6,400	6,239	19,186	18,741
Undistributed earnings to common shareholders	16,866	13,123	46,230	38,897
Total common shareholders earnings, basic	23,266	19,362	65,416	57,638
Diluted
Distributed earnings to common shareholders	6,400	6,239	19,186	18,741
Undistributed earnings to common shareholders	16,866	13,123	46,230	38,897
Total common shareholders earnings, basic	23,266	19,362	65,416	57,638
Add back:
Undistributed earnings reallocated from unvested restricted stock awards	0	0	1	1
Total common shareholders earnings, diluted	$ 23,266	$ 19,362	$ 65,417	$ 57,639
Weighted average common shares outstanding, basic (in shares)	22,338,828	22,520,499	22,306,323	22,544,898
Options (in shares)	51,610	57,381	60,772	69,074
Weighted average common shares outstanding, diluted (in shares)	22,390,438	22,577,880	22,367,095	22,613,972
Basic earnings per common share (in dollars per share)	$ 1.04	$ 0.86	$ 2.93	$ 2.56
Diluted earnings per common share (in dollars per share)	$ 1.04	$ 0.86	$ 2.92	$ 2.55

FAIR VALUE OF FINANCIAL INSTRUMENTS - Recurring and Nonrecurring basis (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Assets
Investment securities available for sale	$ 681,889		$ 681,889		$ 906,603
Equity securities recorded at fair value	8,615		8,615		9,529
Loans held for sale	4,338		4,338		32,045
Losses recognized on assets measured on non-recurring basis
Commercial mortgage servicing rights	0	$ (3,037)	(1,263)	$ (5,460)
Residential mortgage servicing rights held for sale			0	(222)
U.S. Treasury securities
Assets
Investment securities available for sale	60,496		60,496		64,917
U.S. government sponsored entities and U.S. agency securities
Assets
Investment securities available for sale	27,865		27,865		33,817
Mortgage-backed securities - non-agency
Assets
Investment securities available for sale	21,158		21,158		28,706
State and municipal securities
Assets
Investment securities available for sale	95,061		95,061		143,099
Corporate securities
Assets
Investment securities available for sale	85,694		85,694		195,794
Recurring member
Assets
Loans held for sale	4,338		4,338		32,045
Derivative assets	17,033		17,033		5,883
Total	711,875		711,875		954,060
Liabilities
Derivative liabilities	11,512		11,512		397
Total	11,512		11,512		397
Recurring member \| U.S. Treasury securities
Assets
Investment securities available for sale	60,496		60,496		64,917
Recurring member \| U.S. government sponsored entities and U.S. agency securities
Assets
Investment securities available for sale	27,865		27,865		33,817
Recurring member \| Mortgage-backed securities - agency
Assets
Investment securities available for sale	391,615		391,615		440,270
Recurring member \| Mortgage-backed securities - non-agency
Assets
Investment securities available for sale	21,158		21,158		28,706
Recurring member \| State and municipal securities
Assets
Investment securities available for sale	95,061		95,061		143,099
Recurring member \| Corporate securities
Assets
Investment securities available for sale	85,694		85,694		195,794
Recurring member \| Equity securities
Assets
Equity securities recorded at fair value	8,615		8,615		9,529
Recurring member \| Level 1
Assets
Loans held for sale	0		0		0
Derivative assets	0		0		0
Total	69,111		69,111		74,446
Liabilities
Derivative liabilities	0		0		0
Total	0		0		0
Recurring member \| Level 1 \| U.S. Treasury securities
Assets
Investment securities available for sale	60,496		60,496		64,917
Recurring member \| Level 1 \| U.S. government sponsored entities and U.S. agency securities
Assets
Investment securities available for sale	0		0		0
Recurring member \| Level 1 \| Mortgage-backed securities - agency
Assets
Investment securities available for sale	0		0		0
Recurring member \| Level 1 \| Mortgage-backed securities - non-agency
Assets
Investment securities available for sale	0		0		0
Recurring member \| Level 1 \| State and municipal securities
Assets
Investment securities available for sale	0		0		0
Recurring member \| Level 1 \| Corporate securities
Assets
Investment securities available for sale	0		0		0
Recurring member \| Level 1 \| Equity securities
Assets
Equity securities recorded at fair value	8,615		8,615		9,529
Recurring member \| Level 2
Assets
Loans held for sale	4,338		4,338		32,045
Derivative assets	17,033		17,033		5,883
Total	642,764		642,764		878,679
Liabilities
Derivative liabilities	11,512		11,512		397
Total	11,512		11,512		397
Recurring member \| Level 2 \| U.S. Treasury securities
Assets
Investment securities available for sale	0		0		0
Recurring member \| Level 2 \| U.S. government sponsored entities and U.S. agency securities
Assets
Investment securities available for sale	27,865		27,865		33,817
Recurring member \| Level 2 \| Mortgage-backed securities - agency
Assets
Investment securities available for sale	391,615		391,615		440,270
Recurring member \| Level 2 \| Mortgage-backed securities - non-agency
Assets
Investment securities available for sale	21,158		21,158		28,706
Recurring member \| Level 2 \| State and municipal securities
Assets
Investment securities available for sale	95,061		95,061		143,099
Recurring member \| Level 2 \| Corporate securities
Assets
Investment securities available for sale	85,694		85,694		194,859
Recurring member \| Level 2 \| Equity securities
Assets
Equity securities recorded at fair value	0		0		0
Recurring member \| Level 3
Assets
Loans held for sale	0		0		0
Derivative assets	0		0		0
Total	0		0		935
Liabilities
Derivative liabilities	0		0		0
Total	0		0		0
Recurring member \| Level 3 \| U.S. Treasury securities
Assets
Investment securities available for sale	0		0		0
Recurring member \| Level 3 \| U.S. government sponsored entities and U.S. agency securities
Assets
Investment securities available for sale	0		0		0
Recurring member \| Level 3 \| Mortgage-backed securities - agency
Assets
Investment securities available for sale	0		0		0
Recurring member \| Level 3 \| Mortgage-backed securities - non-agency
Assets
Investment securities available for sale	0		0		0
Recurring member \| Level 3 \| State and municipal securities
Assets
Investment securities available for sale	0		0		0
Recurring member \| Level 3 \| Corporate securities
Assets
Investment securities available for sale	0		0		935
Recurring member \| Level 3 \| Equity securities
Assets
Equity securities recorded at fair value	0		0		0
Non recurring member
Assets measured at fair value on a non-recurring basis:
Loan servicing rights	1,297		1,297		28,865
Commercial FHA mortgage servicing rights held for sale	23,995		23,995
Nonperforming loans	46,882		46,882		36,542
Other real estate owned	11,141		11,141		12,059
Assets held for sale	1,271		1,271		2,284
Losses recognized on assets measured on non-recurring basis
Commercial mortgage servicing rights	0	3,037	1,263	5,460
Residential mortgage servicing rights held for sale	0	79	0	222
Nonperforming loans	1,423	3,405	6,381	9,677
Other real estate owned	339	9	743	426
Assets held for sale	0	0	0	0
Total loss on assets measured on a nonrecurring basis	1,762	$ 6,530	8,387	$ 15,785
Non recurring member \| Level 1
Assets measured at fair value on a non-recurring basis:
Loan servicing rights	0		0		0
Commercial FHA mortgage servicing rights held for sale	0		0
Nonperforming loans	11,516		11,516		24,358
Other real estate owned	0		0		0
Assets held for sale	0		0		0
Non recurring member \| Level 2
Assets measured at fair value on a non-recurring basis:
Loan servicing rights	0		0		0
Commercial FHA mortgage servicing rights held for sale	0		0
Nonperforming loans	25,128		25,128		6,129
Other real estate owned	11,141		11,141		12,059
Assets held for sale	1,271		1,271		2,284
Non recurring member \| Level 3
Assets measured at fair value on a non-recurring basis:
Loan servicing rights	1,297		1,297		28,865
Commercial FHA mortgage servicing rights held for sale	23,995		23,995
Nonperforming loans	10,238		10,238		6,055
Other real estate owned	0		0		0
Assets held for sale	$ 0		$ 0		$ 0

FAIR VALUE OF FINANCIAL INSTRUMENTS - Unobservable inputs (Level 3) (Details) - Corporate securities - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, beginning of period	$ 0	$ 1,008	$ 935	$ 959
Transferred to level 2	0	0	(935)	0
Total realized in earnings	0	4	6	10
Total unrealized in other comprehensive income	0	(73)		(24)
Net settlements (principal and interest)	0	(4)	(6)	(10)
Balance, end of period	$ 0	$ 935	$ 0	$ 935

FAIR VALUE OF FINANCIAL INSTRUMENTS - Quantitative Information (Details) $ in Thousands	Sep. 30, 2022 USD ($)	Dec. 31, 2021 USD ($)
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investment securities available for sale	$ 681,889	$ 906,603
Non recurring member
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Loan servicing rights	1,297	$ 28,865
Level 3 \| Net market price \| Corporate securities \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investment securities available for sale, measurement input		0.000
Level 3 \| Net market price \| Corporate securities \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investment securities available for sale, measurement input		0.070
Level 3 \| Net market price \| Corporate securities \| Weighted Average
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investment securities available for sale, measurement input		0.045
Level 3 \| Recurring member \| Net market price \| Corporate securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investment securities available for sale		$ 935
Level 3 \| Non recurring member
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Loan servicing rights	1,297	28,865
Level 3 \| Non recurring member \| Discounted cash flow \| SBA servicing rights
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Loan servicing rights	715	898
Level 3 \| Non recurring member \| Discounted cash flow \| Residential servicing rights
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Loan servicing rights	582	705
Level 3 \| Non recurring member \| Discounted cash flow \| Commercial FHA servicing rights held for sale
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Loan servicing rights	$ 23,995	$ 28,368
Level 3 \| Non recurring member \| Discounted cash flow \| Prepayment speed \| SBA servicing rights \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.1421	0.1227
Level 3 \| Non recurring member \| Discounted cash flow \| Prepayment speed \| SBA servicing rights \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.1540	0.1414
Level 3 \| Non recurring member \| Discounted cash flow \| Prepayment speed \| SBA servicing rights \| Weighted Average
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.1495	0.1388
Level 3 \| Non recurring member \| Discounted cash flow \| Prepayment speed \| Residential servicing rights \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.0756	0.1194
Level 3 \| Non recurring member \| Discounted cash flow \| Prepayment speed \| Residential servicing rights \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.3114	0.2748
Level 3 \| Non recurring member \| Discounted cash flow \| Prepayment speed \| Residential servicing rights \| Weighted Average
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.0846	0.1494
Level 3 \| Non recurring member \| Discounted cash flow \| Prepayment speed \| Commercial FHA servicing rights held for sale \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.0800	0.0800
Level 3 \| Non recurring member \| Discounted cash flow \| Prepayment speed \| Commercial FHA servicing rights held for sale \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.1800	0.1800
Level 3 \| Non recurring member \| Discounted cash flow \| Prepayment speed \| Commercial FHA servicing rights held for sale \| Weighted Average
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.0821	0.0824
Level 3 \| Non recurring member \| Discounted cash flow \| Discount rate \| SBA servicing rights \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset		0.1000
Level 3 \| Non recurring member \| Discounted cash flow \| Discount rate \| SBA servicing rights \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset		0.1200
Level 3 \| Non recurring member \| Discounted cash flow \| Discount rate \| SBA servicing rights \| Weighted Average
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.1150	0.1100
Level 3 \| Non recurring member \| Discounted cash flow \| Discount rate \| Residential servicing rights \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.0900	0.0900
Level 3 \| Non recurring member \| Discounted cash flow \| Discount rate \| Residential servicing rights \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.1150	0.1150
Level 3 \| Non recurring member \| Discounted cash flow \| Discount rate \| Residential servicing rights \| Weighted Average
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.1013	0.1025
Level 3 \| Non recurring member \| Discounted cash flow \| Discount rate \| Commercial FHA servicing rights held for sale \| Minimum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.1000	0.1000
Level 3 \| Non recurring member \| Discounted cash flow \| Discount rate \| Commercial FHA servicing rights held for sale \| Maximum
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.2700	0.2700
Level 3 \| Non recurring member \| Discounted cash flow \| Discount rate \| Commercial FHA servicing rights held for sale \| Weighted Average
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input for servicing asset	0.1148	0.1187

FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair value option and gains and losses from fair value changes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Fair Value, Option, Quantitative Disclosures [Line Items]
Aggregate fair value	$ 4,338		$ 4,338		$ 32,045
Difference	(73)		(73)		584
Contractual principal	4,411		4,411		31,461
Gains and losses from fair value changes
Gains and losses from fair value changes of loan held for sales	(280)	$ (231)	(557)	$ (361)
Commercial Loan Portfolio
Fair Value, Option, Quantitative Disclosures [Line Items]
Aggregate fair value	0		0		19,230
Difference	0		0		0
Contractual principal	0		0		19,230
Gains and losses from fair value changes
Gains and losses from fair value changes of loan held for sales	0	0	0	(67)
Residential Portfolio Segment
Fair Value, Option, Quantitative Disclosures [Line Items]
Aggregate fair value	4,338		4,338		12,815
Difference	(73)		(73)		584
Contractual principal	4,411		4,411		$ 12,231
Gains and losses from fair value changes
Gains and losses from fair value changes of loan held for sales	$ (280)	$ (231)	$ (557)	$ (294)

FAIR VALUE OF FINANCIAL INSTRUMENTS - Carrying values and fair value (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Assets
Accrued interest receivable	$ 17,537	$ 19,470
Liabilities
Trust preferred debentures	49,824	49,374
Level 1
Assets
Cash and due from banks	309,531	673,297
Federal funds sold	3,657	7,074
Loans, net	0	0
Accrued interest receivable	0	0
Liabilities
Deposits	0	0
Short-term borrowings	0	0
FHLB and other borrowings	0	0
Subordinated debt	0	0
Trust preferred debentures	0	0
Level 2
Assets
Cash and due from banks	0	0
Federal funds sold	0	0
Loans, net	0	0
Accrued interest receivable	17,537	19,470
Liabilities
Deposits	6,370,773	6,109,077
Short-term borrowings	58,518	76,803
FHLB and other borrowings	358,694	317,464
Subordinated debt	135,279	148,386
Trust preferred debentures	54,965	57,827
Level 3
Assets
Cash and due from banks	0	0
Federal funds sold	0	0
Loans, net	6,025,586	5,221,886
Accrued interest receivable	0	0
Liabilities
Deposits	0	0
Short-term borrowings	0	0
FHLB and other borrowings	0	0
Subordinated debt	0	0
Trust preferred debentures	0	0
Carrying amount
Assets
Cash and due from banks	309,531	673,297
Federal funds sold	3,657	7,074
Loans, net	6,139,812	5,173,739
Accrued interest receivable	17,537	19,470
Liabilities
Deposits	6,395,252	6,110,648
Short-term borrowings	58,518	76,803
FHLB and other borrowings	360,000	310,171
Subordinated debt	139,370	139,091
Trust preferred debentures	49,824	49,374
Fair value
Assets
Cash and due from banks	309,531	673,297
Federal funds sold	3,657	7,074
Loans, net	6,025,586	5,221,886
Accrued interest receivable	17,537	19,470
Liabilities
Deposits	6,370,773	6,109,077
Short-term borrowings	58,518	76,803
FHLB and other borrowings	358,694	317,464
Subordinated debt	135,279	148,386
Trust preferred debentures	$ 54,965	$ 57,827

COMMITMENTS, CONTINGENCIES AND CREDIT RISK (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Anticipated material loss	$ 0		$ 0
Losses as a result of make whole requests and loan repurchases	0	$ 0	0	$ 0
Liability for unresolved repurchase demands	200,000		200,000		$ 200,000
Commitments to extend credit
Loan commitments	1,280,312,000		1,280,312,000		994,709,000
Financial guarantees – standby letters of credit
Loan commitments	$ 31,315,000		$ 31,315,000		$ 14,325,000

SEGMENT INFORMATION (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
SEGMENT INFORMATION (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Segment Reporting Information [Line Items]
Net interest income (expense)	$ 64,024	$ 51,396	$ 182,185	$ 153,374
Provision for credit losses	6,974	(184)	16,582	2,926
Noninterest income	15,826	15,143	46,052	47,376
Noninterest expense	43,496	41,292	125,719	129,312
Income before income taxes	29,380	25,431	85,936	68,512
Income taxes (benefit)	5,859	5,883	19,783	10,302
Net income	23,521	19,548	66,153	58,210
Total assets	7,821,877	7,093,959	7,821,877	7,093,959	$ 7,443,805
Banking
Segment Reporting Information [Line Items]
Net interest income (expense)	66,846	53,888	190,162	161,514
Provision for credit losses	6,974	(184)	16,582	2,926
Noninterest income	9,646	7,917	26,547	27,649
Noninterest expense	39,338	37,055	112,947	117,655
Income before income taxes	30,180	24,934	87,180	68,582
Income taxes (benefit)	9,238	4,973	23,498	9,849
Net income	20,942	19,961	63,682	58,733
Total assets	7,809,280	7,091,180	7,809,280	7,091,180
Wealth management
Segment Reporting Information [Line Items]
Net interest income (expense)	0	0	0	0
Provision for credit losses	0	0	0	0
Noninterest income	6,199	7,175	19,481	19,635
Noninterest expense	4,364	4,507	13,130	12,672
Income before income taxes	1,835	2,668	6,351	6,963
Income taxes (benefit)	498	764	1,761	1,967
Net income	1,337	1,904	4,590	4,996
Total assets	29,166	31,274	29,166	31,274
Other
Segment Reporting Information [Line Items]
Net interest income (expense)	(2,822)	(2,492)	(7,977)	(8,140)
Provision for credit losses	0	0	0	0
Noninterest income	(19)	51	24	92
Noninterest expense	(206)	(270)	(358)	(1,015)
Income before income taxes	(2,635)	(2,171)	(7,595)	(7,033)
Income taxes (benefit)	(3,877)	146	(5,476)	(1,514)
Net income	1,242	(2,317)	(2,119)	(5,519)
Total assets	$ (16,569)	$ (28,495)	$ (16,569)	$ (28,495)

REVENUE FROM CONTRACTS WITH CUSTOMERS (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Noninterest income - out-of-scope of Topic 606	$ 2,204	$ 719	$ 5,712	$ 6,636
Total noninterest income	15,826	15,143	46,052	47,376
Trust management/administration fees
Disaggregation of Revenue [Line Items]
Revenue	5,241	5,623	16,362	15,054
Investment advisory fees
Disaggregation of Revenue [Line Items]
Revenue	0	577	0	1,462
Investment brokerage fees
Disaggregation of Revenue [Line Items]
Revenue	482	330	1,623	1,206
Other
Disaggregation of Revenue [Line Items]
Revenue	476	645	1,496	1,913
Nonsufficient fund fees
Disaggregation of Revenue [Line Items]
Revenue	1,775	1,470	4,631	3,814
Other
Disaggregation of Revenue [Line Items]
Revenue	822	798	2,338	2,196
Interchange revenues
Disaggregation of Revenue [Line Items]
Revenue	3,531	3,651	10,401	10,823
Merchant services revenue
Disaggregation of Revenue [Line Items]
Revenue	448	405	1,203	1,137
Other
Disaggregation of Revenue [Line Items]
Revenue	$ 847	$ 925	$ 2,286	$ 3,135

SUBSEQUENT EVENTS (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
SUBSEQUENT EVENTS (Details) - USD ($) $ in Thousands	Oct. 24, 2022	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Subsequent Event [Line Items]
Derivative, gain (loss) on derivative, net		$ (200)	$ (400)	$ (600)	$ (1,300)
Future Starting Receive Fixed, Pay Variable Interest Rate Swaps \| Cash Flow Hedge
Subsequent Event [Line Items]
Notational amount, asset		$ 140,000		$ 140,000		$ 140,000
Future Starting Receive Fixed, Pay Variable Interest Rate Swaps \| Cash Flow Hedge \| Subsequent Event
Subsequent Event [Line Items]
Notational amount, asset	$ 140,000
Derivative, gain (loss) on derivative, net	$ 17,600

LOANS - Aging Status of recorded investment (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Aging Status of recorded investment
Loans	$ 6,198,451	$ 5,224,801
Total nonaccrual	40,051	35,563
Nonperforming
Aging Status of recorded investment
Total nonaccrual	40,051	35,563
30-59 days past due \| Performing
Aging Status of recorded investment
Loans	20,848	10,069
60-89 days past due \| Performing
Aging Status of recorded investment
Loans	7,427	7,445
Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	693	6
Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	28,968	17,520
Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	6,129,432	5,171,718
Commercial Loan Portfolio
Aging Status of recorded investment
Loans	4,228,135	3,460,765
Total nonaccrual	34,158	29,159
Commercial Loan Portfolio \| Nonperforming
Aging Status of recorded investment
Total nonaccrual	34,158	29,159
Commercial Loan Portfolio \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	12,459	3,697
Commercial Loan Portfolio \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	2,972	4,386
Commercial Loan Portfolio \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	281	5
Commercial Loan Portfolio \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	15,712	8,088
Commercial Loan Portfolio \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	4,178,265	3,423,518
Lease financing
Aging Status of recorded investment
Loans	457,611	423,280
Lease financing \| Performing
Aging Status of recorded investment
Loans	455,088	420,376
Lease financing \| Nonperforming
Aging Status of recorded investment
Loans	2,523	2,904
Total nonaccrual	1,506	1,510
Lease financing \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	3,033	1,253
Lease financing \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	987	245
Lease financing \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	193	0
Lease financing \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	4,213	1,498
Lease financing \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	451,892	420,272
Commercial \| Commercial Loan Portfolio
Aging Status of recorded investment
Loans	852,930	770,670
Total nonaccrual	4,687	6,956
Commercial \| Commercial Loan Portfolio \| Nonperforming
Aging Status of recorded investment
Total nonaccrual	4,687	6,956
Commercial \| Commercial Loan Portfolio \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	7,609	283
Commercial \| Commercial Loan Portfolio \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	518	1,082
Commercial \| Commercial Loan Portfolio \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	0	0
Commercial \| Commercial Loan Portfolio \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	8,127	1,365
Commercial \| Commercial Loan Portfolio \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	840,116	762,349
Commercial other \| Commercial Loan Portfolio
Aging Status of recorded investment
Loans	683,353	679,518
Total nonaccrual	2,104	4,467
Commercial other \| Commercial Loan Portfolio \| Nonperforming
Aging Status of recorded investment
Total nonaccrual	2,104	4,467
Commercial other \| Commercial Loan Portfolio \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	3,510	2,402
Commercial other \| Commercial Loan Portfolio \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	2,189	2,110
Commercial other \| Commercial Loan Portfolio \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	281	5
Commercial other \| Commercial Loan Portfolio \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	5,980	4,517
Commercial other \| Commercial Loan Portfolio \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	675,269	670,534
Commercial real estate non-owner occupied \| Commercial Loan Portfolio
Aging Status of recorded investment
Loans	1,567,308	1,105,333
Total nonaccrual	13,708	11,826
Commercial real estate non-owner occupied \| Commercial Loan Portfolio \| Nonperforming
Aging Status of recorded investment
Total nonaccrual	13,708	11,826
Commercial real estate non-owner occupied \| Commercial Loan Portfolio \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	771	585
Commercial real estate non-owner occupied \| Commercial Loan Portfolio \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	265	243
Commercial real estate non-owner occupied \| Commercial Loan Portfolio \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	0	0
Commercial real estate non-owner occupied \| Commercial Loan Portfolio \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	1,036	828
Commercial real estate non-owner occupied \| Commercial Loan Portfolio \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	1,552,564	1,092,679
Commercial real estate owner occupied \| Commercial Loan Portfolio
Aging Status of recorded investment
Loans	505,174	469,658
Total nonaccrual	4,222	3,504
Commercial real estate owner occupied \| Commercial Loan Portfolio \| Nonperforming
Aging Status of recorded investment
Total nonaccrual	4,222	3,504
Commercial real estate owner occupied \| Commercial Loan Portfolio \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	481	232
Commercial real estate owner occupied \| Commercial Loan Portfolio \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	0	730
Commercial real estate owner occupied \| Commercial Loan Portfolio \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	0	0
Commercial real estate owner occupied \| Commercial Loan Portfolio \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	481	962
Commercial real estate owner occupied \| Commercial Loan Portfolio \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	500,471	465,192
Multi-family \| Commercial Loan Portfolio
Aging Status of recorded investment
Loans	328,473	171,875
Total nonaccrual	9,167	2,168
Multi-family \| Commercial Loan Portfolio \| Nonperforming
Aging Status of recorded investment
Total nonaccrual	9,167	2,168
Multi-family \| Commercial Loan Portfolio \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	0	0
Multi-family \| Commercial Loan Portfolio \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	0	0
Multi-family \| Commercial Loan Portfolio \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	0	0
Multi-family \| Commercial Loan Portfolio \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	0	0
Multi-family \| Commercial Loan Portfolio \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	319,306	169,707
Farmland \| Commercial Loan Portfolio
Aging Status of recorded investment
Loans	65,348	69,962
Total nonaccrual	25	155
Farmland \| Commercial Loan Portfolio \| Nonperforming
Aging Status of recorded investment
Total nonaccrual	25	155
Farmland \| Commercial Loan Portfolio \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	88	0
Farmland \| Commercial Loan Portfolio \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	0	26
Farmland \| Commercial Loan Portfolio \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	0	0
Farmland \| Commercial Loan Portfolio \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	88	26
Farmland \| Commercial Loan Portfolio \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	65,235	69,781
Construction and land development \| Commercial Loan Portfolio
Aging Status of recorded investment
Loans	225,549	193,749
Total nonaccrual	245	83
Construction and land development \| Commercial Loan Portfolio \| Nonperforming
Aging Status of recorded investment
Total nonaccrual	245	83
Construction and land development \| Commercial Loan Portfolio \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	0	195
Construction and land development \| Commercial Loan Portfolio \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	0	195
Construction and land development \| Commercial Loan Portfolio \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	0	0
Construction and land development \| Commercial Loan Portfolio \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	0	390
Construction and land development \| Commercial Loan Portfolio \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	225,304	193,276
Residential first lien \| Residential Portfolio Segment
Aging Status of recorded investment
Loans	294,432	274,412
Total nonaccrual	3,517	3,948
Residential first lien \| Residential Portfolio Segment \| Performing
Aging Status of recorded investment
Loans	288,362	268,207
Residential first lien \| Residential Portfolio Segment \| Nonperforming
Aging Status of recorded investment
Loans	6,070	6,205
Total nonaccrual	3,517	3,948
Residential first lien \| Residential Portfolio Segment \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	30	113
Residential first lien \| Residential Portfolio Segment \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	209	285
Residential first lien \| Residential Portfolio Segment \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	77	0
Residential first lien \| Residential Portfolio Segment \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	316	398
Residential first lien \| Residential Portfolio Segment \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	290,599	270,066
Other residential \| Residential Portfolio Segment
Aging Status of recorded investment
Loans	61,793	63,739
Total nonaccrual	798	836
Other residential \| Residential Portfolio Segment \| Performing
Aging Status of recorded investment
Loans	60,087	62,032
Other residential \| Residential Portfolio Segment \| Nonperforming
Aging Status of recorded investment
Loans	1,706	1,707
Total nonaccrual	798	836
Other residential \| Residential Portfolio Segment \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	197	456
Other residential \| Residential Portfolio Segment \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	50	151
Other residential \| Residential Portfolio Segment \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	0	0
Other residential \| Residential Portfolio Segment \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	247	607
Other residential \| Residential Portfolio Segment \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	60,748	62,296
Consumer \| Consumer
Aging Status of recorded investment
Loans	110,226	106,008
Total nonaccrual	72	110
Consumer \| Consumer \| Performing
Aging Status of recorded investment
Loans	110,094	105,800
Consumer \| Consumer \| Nonperforming
Aging Status of recorded investment
Loans	132	208
Total nonaccrual	72	110
Consumer \| Consumer \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	109	127
Consumer \| Consumer \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	50	20
Consumer \| Consumer \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	0	0
Consumer \| Consumer \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	159	147
Consumer \| Consumer \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	109,995	105,751
Consumer other \| Consumer
Aging Status of recorded investment
Loans	1,046,254	896,597
Consumer other \| Consumer \| Performing
Aging Status of recorded investment
Loans	1,046,113	896,596
Consumer other \| Consumer \| Nonperforming
Aging Status of recorded investment
Loans	141	1
Total nonaccrual	0	0
Consumer other \| Consumer \| 30-59 days past due \| Performing
Aging Status of recorded investment
Loans	5,020	4,423
Consumer other \| Consumer \| 60-89 days past due \| Performing
Aging Status of recorded investment
Loans	3,159	2,358
Consumer other \| Consumer \| Past due 90 days or more \| Performing
Aging Status of recorded investment
Loans	142	1
Consumer other \| Consumer \| Financial Asset, Past Due \| Performing
Aging Status of recorded investment
Loans	8,321	6,782
Consumer other \| Consumer \| Financial Asset, Not Past Due \| Performing
Aging Status of recorded investment
Loans	1,037,933	889,815
Lease financing \| Lease financing
Aging Status of recorded investment
Total nonaccrual	$ 1,506	$ 1,510